2.1 - Total $ 18,910.00 Total $ 18,910.00 Margin =...

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Critical Price of Margin Call = ($16,500/400 shares) / (1-.30) = $58.93 8. Critical Price of Short Margin Call = (($63,900 + $38,340)/900 shares) / (1 + .30) = $87.38 11. Balance Sheet at purchase time ($71 per share) Assets Liabilities and Equity 305 Shares of Carson Corp. $ 21,655.00 Margin Loan $ 8,662.00 Account Equity 12,993.00 Total $ 21,655.00 Total $ 21,655.00 Margin = $12,993/$21,655 = .60 or 60% Balance Sheet at $82 per share Assets Liabilities and Equity 305 Shares of Carson Corp. $ 25,620.00 Margin Loan $ 8,662.00 Account Equity 16,958.00 Total $ 25,620.00 Total $ 25,620.00 Margin = $16,958/$25,620 = .6619 or 66.19% Balance sheet at $62 per share Assets Liabilities and Equity 305 Shares of Carson Corp. $ 18,910.00 Margin Loan $ 8,662.00 Account Equity 10,248.00
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Unformatted text preview: Total $ 18,910.00 Total $ 18,910.00 Margin = $10,248/$18,910 = .5419 or 54.19% 12. 600 shares * $46 per share = $27,600 Initial Margin = $11,000 /$27,600 = .3986 or 39.86% Assets Liabilities and Equity 600 Shares of Smolira Golf $ 27,600.00 Margin Loan $ 16,600.00 Account Equity 11,000.00 Total $ 27,600.00 Total $ 27,600.00 15. Beginning Value = 1,000 shares * $51 per share = $51,000 * .40 initial margin = $20,400 Margin Loan = 51,000 - $20,400 = $30,600 Interest = $ 30,600 * .087 = $2,662.20 Ending Value = 1,000 shares * $57 per share = $57,000 Ending Equity = $57,000 - $2,662.20 - $30,600 = $23,737.80 Return = $23,737.80 - $20,400 = $3,337.80 Return Percentage = .1636 or 16.36%...
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