Question: Use these approximate closing prices to work these problems: INTC = 126, MCD = 32. 1. If you bought Intel (INTC) using cash at yesterdays

Use these approximate closing prices to work these problems: INTC = 126, MCD = 32.

1. If you bought Intel (INTC) using cash at yesterdays closing price and the price increases to 150, what is your dollar gain? What is your percentage gain on your initial investment?

2. From the previous problem, what is your initial equity position if you bought 100 shares on margin with an initial margin requirement of 50%? What is your final equity position if the price immediately increases to 150? What is your percentage gain or loss? What is the relationship between change in stock price and change in equity when buying on margin?

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