Answered: Explain the difference between Initial…

Business

Economics

Explain the difference between Initial Margin and Maintenance margin in stock trading.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter17: Financial Markets

Section: Chapter Questions

Problem 26RQ: Why is it hand to forecast future movements in stock prices?

See similar textbooks

Related questions

Q: Let us define Free agency as a professional athlete who is not under contract and is free to auction…

A: A free agent in professional sports is a player who is not under contract to any single organisation…

Q: Calculate the CPI, based on the following information. You must show your work to get full credit.…

A: CPI = Cost of basket at current periodCost of basket at base period period*100

Q: A person receive a phone call from the Registrar saying that he had not came to Companies…

A: Registration According to Section 5 of the Registration of Business Act of 1956, a company must…

Q: Marketing surveys conducted by the sales manager for a company determined that 3,000 power drills…

Q: A consumer has a utility function such that the marginal utility for good x is given by MUx-(2y/(3x)…

A: Here, the marginal utility of X is given 2y/3x and marginal utility of Y is given as 1/y.

Q: The graph shows the relevant curves for a natural monopoly. Price The two AC curves show average…

A: A natural monopoly is a sort of monopoly that exists ordinarily because of the great beginning up…

Q: In the long run money is... neutral important fixed fictional

A: Long run can be defined as a time period in which both the fixed as well as the variable factor of…

Q: Metal is used to produce plows and nothing more. When necessary, use 2013 as the base year. The…

A: INFLATION" it is the rate of increase in price over a given period of time".

Q: The war Russia is waging against Ukraine has already halted most of Ukraine’s production…

A: The unexpected and most critical situation between Russia and Ukraine brought about disruptions in…

Q: Determine the equilibrium quantities of commodities x and z for a consumer whose total utility (U)…

A: The term "consumer equilibrium" refers to a scenario in which a consumer is completely satisfied…

Q: A factory that you are managing has an hourly production process that can be represented by the…

A: Answer -

Q: Some policy makers have claimed that the U.S. government should purchase illegal drugs, such as…

Q: price level LRAS SRAS1 SRAS2 Refer to the above Figure. If the economy is AD1 AD2 quantity of output…

A: Hi! Thank you for the question. As per the honor code, We’ll answer the first question since the…

Q: Assume Saudi Arabia to be home and US to be the foreign economy. Suppose that the real exchange rate…

A: Real Exchange Rate = Nominal Exchange Rate (Domestic Price / Foreign Price ) E = e (P /P*) e = E…

Q: Of those Americans without health care protection, the poor and children comprise the majority. T or…

A: Meaning of Health Economics: Here, the term health economics refers to the scenario under which…

Q: Commodities a) Rely heavily on advertising to see their sales grow. b) Have prices that are…

A: Commodities include raw materials and equipments used by producers for producing other goods and…

Q: The "winner's curse" refers to a situation where the winning bidder's net present value of the…

A: The winner's curse causes the winner to overpay on a bid, implying that they paid more than the…

Q: 1. Mark's demand for chicken is given as follows: Price of Chicken Quantity demanded per week…

A: Elasticity of demand measures the responsiveness of quantity demanded to changes in price level.

Q: For the cost function C(Q) = 200+3Q2+4Q3, what is the average fixed cost of producing 10 units of…

A: We have total cost function: C(Q)=200+3Q2+4Q3 ... (1) We have to calculate average fixed…

Q: Question 6 What is the present worth of 5 payments of S700 if the interest rate is 5% and the first…

A: Present Worth is the value of the sum of money from the future or of the amount that is receivable…

Q: Which of the following was not one of Reagan's four major policy objectives? Reduce federal income…

A: The policies that are being characterized and are being associated commonly with the supply side of…

Q: The figure shows the initial LRAS and SRAS curves. - Answer if the expected price is higher than,…

A: The aggregate supply is the total amount of services and commodities that firms in an economic plan…

Q: 5. Opportunity cost and production possibilities Simone is a skilled toy maker who is able to…

A: Production possibilities frontier shows different combinations of two goods that can be produced…

Q: Consider a firm who owns capital K and has the following production technology Y = zF(K, N)= 2K³N³,…

A: A production function is a mathematical equation that expresses the relationship between the number…

Q: Question 6 What is the present worth of 5 payments of $700 if the interest rate is 5% and the first…

A: Present value of annuity due = A * [(1/i) - { (1) / i(1+i)n }] * (1+i) Where, i = Interest rate, n =…

Q: How to construct a Ad, SRAS and LRAS curve for economy with.. full employment Economic boom A…

A: LRAS is vertical at full employment. There is an economic boom when more than full employment output…

Q: An economist estimates the cost function for Redwood Hill Farm, LLC as shown below. Redwood Hill…

A: For a specific production of a commodity, cost refers to the expense made by a producer on factor…

Q: The monopolist will produce which quantity of output? a) Q1 b) Q2 c) Q3 d) Q4 e) none of the answers…

A: A monopolist is a single seller. He is the price maker.

Q: If the price elasticity of demand for labor is 0.2 and the wage increased from $11 to $16 an hour,…

A: Given information, Price elasticity of demand for labor: 0.2 Initial wage: $11 Final wage: $16 To…

Q: please elaborate. thanks.

A: Inflation means an increase in the price level of goods and services in an economy. It means the…

Q: Machine A has a fixed cost of $40000 per year and a variable cost of S60 per unit. Machine B has an…

A: Cost refers to the total expenditure that is incur in an production process.Cost is made up of from…

Q: Suppose that Obdulia reflects the following preferences: U(x, y)= ln(x) + y, if Obdulia's initial…

A: Given information U=ln(X)+Y M=15000 Px=100 Py=150 P'x=80

Q: Discuss the current Fiscal Policy with the impact of the coronavirus on macroeconomics in place to…

A: To revive any economy from the brink of recession there can two types of policies:- Expansionary…

Q: Among the factors that affect demand in addition to pr :she People tools and income. Producing new…

A: The factors that affect demand other than the price level are the non price factors.

Q: Answer the following options: (Q#7) What is the connection between education and the economic…

A: Hi! Thank you for the question As per the honor code, We’ll answer the first question since the…

Q: Do you think international trade leads to not only the commodity price equalization but the factor…

A: International trade agreements govern the exchange of goods and services between two or more…

Q: "Abu Dhabi munidipality is considering buying a truck to help maintain its highways for a very long…

A: Given: Annual Equivalent Costs: Alternative A: $10000 Alternative B: $13000

Q: В. L= 25.

Q: 1

A: The IS curve shows the negative relationship between interest rate and output. It means as the…

Q: We have the following information about a small country. Civilian Population = 300,000 Unemployment…

A: The given information are:- Civilian Population = 300,000 Unemployment Rate = 15.00% Labor Force…

Q: Which of the following is the proper sequence of events in a business cycle model? Peak, GDP falls,…

A: When talking about business cycle, it is the cyclical process that is followed by the market based…

Q: Discuss the current Fiscal Policy with the impact of the coronavirus on macroeconomics in place to…

A: The economics as a study is based upon the idea that the resources which are present with the…

Q: how cashless economy make the international transaction more accessible

A: When transactions in the economy are not based upon money notes, coins, or other physical forms of…

Q: What does the two gap model of poverty trap say? Poverty arises when the rate of return on…

A: An economic system where it is difficult for the people to escape poverty is "Poverty trap". To…

Q: workca wr your groop. 4. Draw a budget line for Lynne, who has a weekly income of 225. Assumte that…

A: Income = $225 Cost of food = $15 Cost of clothes = $25

Q: Sandy receives utility from consuming berries (X) and nuts (Y) as given by utility function u(X,Y) =…

A: Given nuts/ barriers ratio = 62/17 = 3.647

Q: Let K denote the quantity of capital a country has at the beginning of period t. Also, suppose that…

A: Capital refers to anything that provides value or advantage to its owner, such as a factory and its…

Q: Does Airline regulation mean friendlier skies?

A: When there is only one airline company is present then it may lead to generate the problem of…

Q: The Figure above shows statistics on Real GDP in Qatar ($billions) from 2012 to 2020, in addition to…

A: GDP, that is Gross Domestic Product is an important indicator of economic development. It is the…

Q: Sy 6) Which of the following is the LEAST senous impodiment to econemic growth in MENA and SSA? A.…

A: Disclaimer: Since you have posted multiple questions, I am providing you with the answer to the…

Question

1. Explain the difference between Initial Margin and
Maintenance margin in stock trading.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Answer these three questions about early-stage corporate finance: Why do very small companies tend to raise money from private investors instead of through an IPO? Why do small, young companies often prefer an IPO to borrowing from a bank or issuing bonds? Who has better information about whether a small firm is likely to earn profits, a venture capitalist or a potential bondholder, and why?
Why is it hand to forecast future movements in stock prices?
Many retirement funds charge an administrative fee each year equal to 0.25% on managed assets. Suppose that Alexx and Spenser each invest 5,000 in the same stock this year. Alexx invests directly and earns 5 a year. Spenser uses a retirement fund and earns 4.75. After 30 years, how much more will Alexx have than Spenser?
How do the shareholders who own a company choose the actual company managers?
When do firms receive money from a stock sale in their firm and when do they not receive money?
If you owned a small firm that had become somewhat established, but you needed a surge of financial capital to cant out a major expansion, would you prefer to raise the funds through borrowing or by issuing stock? Explain your choice.
What does a share of stock represent?