Margin call price and account equity

Assignment Help Financial Management
Reference no: EM13846207

You short sold 800 shares of stock at a price of $45 and an initial margin of 55 percent. If the maintenance margin is 30 percent, at what share price will you receive a margin call? What is your account equity at this stock price? (Do not round intermediate calculations. Round Margin call price to 2 decimal places. Omit the "$" sign in your response.)

Margin call price               $  

Account equity                 $   

Reference no: EM13846207

Questions Cloud

Evaluate economics of biological emission control system : Evaluate the economics of a biological emission control system and compare it to the thermal/incineration system. For the biological based treatment system, the capital cost is $100,000 with routine maintenance costing $15,000 per year for the first ..
Discussed three theories of behavioural finance : Discussed three theories of behavioural finance that may influence investment in Ponzi scheme. Discuss 3 reasons why Ponzi scheme may be operated by and among the educated
Calculate the benefit cost ratio : Roto Air plans to spend $1,000,000 on this project, resulting in a total savings of $2,500,000 over the life of the project. Calculate the Benefit Cost Ratio. Important: show your work. Ignore any effects of the time value of money
What is annualized return on this investment : Suppose you buy stock at a price of $83 per share. Three months later, you sell it for $89. You also received a dividend of $.38 per share. What is your annualized return on this investment?
Margin call price and account equity : You short sold 800 shares of stock at a price of $45 and an initial margin of 55 percent. If the maintenance margin is 30 percent, at what share price will you receive a margin call? What is your account equity at this stock price?
What is the present value of the payments : Suppose you are going to receive $13,500 per year for five years. The appropriate inerest rate is 8.4 percent. What is the present value of the payments if they are in the form of an ordinary annuity and what is the present value if the payments are ..
Yield expressed with semi-annual compounding : The six month and one-year rates are 3% and 4% per annum with semi-annual compounding. Is 3.90% or 3.95% or 3.99% closest to the one-year par yield expressed with semi-annual compounding?
What is the value of the missing cash flow : The present value of the following cash flow stream is $8,400 when discounted at 9 percent annually. What is the value of the missing cash flow?
What is the new divisor for the price-weighted index : Able, Baker, and Charlie are the only three stocks in an index. The stocks sell for $36, $312, and $82, respectively. If Baker undergoes a 3-for-2 stock split, what is the new divisor for the price-weighted index?

Reviews

Write a Review

Financial Management Questions & Answers

  How a firms cost of capital may decrease

Discuss which exposure might be viewed as the most important to effectively manage, if a conflict between controlling both arises. Also, discuss and critique the common methods for controlling translation exposure - Explain why and how a firm's co..

  Calculate the holding period return on a before-tax basis

Mary and Nick Stalcheck have an investment portfolio containing 4 investments. It was developed to provide them with a balance between current income and capital appreciation. Calculate the holding period return on a before-tax basis for each of thes..

  1 assume that you were a manager of a large department in a

1. assume that you were a manager of a large department in a company and you received a request from your supervisors

  What is the difference in the effective interest rates

You have a savings account that pays 3.7% interest compounded semi annually, but you are considering transferring your funds into a savings account that pays 3.3% interest compounded monthly. Calculate the difference in the effective interest rates o..

  Calculate the standard deviation in the anticipated return

James is considering whether to invest in a newly formed investment fund. The fund's investment objective is to acquire home mortgage securities at what hopes will be bargian prices. Based on these potential outcomes, what is your estimate of the exp..

  Assume a stocks risk and expected rate of return

Assume a stock's risk and expected rate of return are plotted on a graph where the y-axis is required rate of return and the x-axis is risk. Under which of the following conditions is the stock most likely to be sold (if owned) or not purchased?

  Bond valuation with semi annual payments

Renfro Rentals has issued bonds that have a 10% coupon rate, payable semi annually. The bonds mature in 15 years, have a face value of $1,000, and a yield to maturity of 7%. What is the price of the bonds?

  Nominal and effective costs of trade credit

Grunewald Industries sells on terms of 3/10, net 50. Gross sales last year were $4,972,000, and accounts receivable averaged $488,000. Half of Grunewald's customers paid on the 10th day and took discounts. What are the nominal and effective costs of ..

  What is the implied interest rate

You have been given that a 6-month 100 Call option on XYZ stock is trading at $4.25. A put with the same strike price and expiration is trading @ $1.25. If the current price of the sock is 102, what is the implied interest rate?

  A firm is looking to invest in a new sports drink

A firm is looking to invest in a new sports drink. They must invest $4 million today and another $4 million in one year. They expect that in two years, they will receive $3 million in free cash flow, and this will continue for 5 years (so the final $..

  How does debt influence your cash flow

1. When is debt good to have on your balance sheet? How does debt influence your cash flow? How can we best measure the effects of debt and analyze if an organization has "too much" debt?

  Assume that money that is not withdrawn remains in account

In five years, you plan on starting graduate school to earn your MBA. You know that graduate school can be expensive and you expect you will need $15,000 per year for tuition and other school expenses. Assume that money that is not withdrawn remains ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd