If an investor buys 1,000 shares at $50 and the initial margin is 60% and the maintenance margin is 30%, the investor will receive the first margin call when the stock price falls below: $41.29 $38.52 $31.57 $28.57 $26.77

If an investor buys 1,000 shares at $50 and the initial margin is 60% and the maintenance margin is 30%, the investor will receive the first margin call when the stock price falls below: $41.29 $38.52 $31.57 $28.57 $26.77

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter7: Stocks (equity) - Characterstics And Valuation

Section: Chapter Questions

Problem 4PROB

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Question

If an investor buys 1,000 shares at $50 and the initial margin is 60% and the maintenance margin is 30%, the investor will receive the first margin call when the stock price falls below:

$41.29
$38.52
$31.57
$28.57
$26.77

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