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You purchased 100 shares of common stock on margin at $45 per share. Assume the initial margin is 50% and the stock pays no dividend. What would the maintenance margin be if a margin call is made at a stock price of $30

Respuesta :

abiolataiwo2015

Answer:

0.25

Step by step Explanation:

Purchases 100 shares of common stock on margin at $45

Initial margin is 50%

Stock price$30

100 shares * $45/share * 0.5 = $4,500

$4,500 * 0.5 = $2,250 (loan amount)

Therefore

X = [100($30) - $2,250]

=3,000-2,250=750

100($30)=$3,000

750/3,000= 0.25

X = 0.25