You Purchase 500 Shares of Stock on Margin at a Cost

question 20

Multiple Choice

You purchase 500 shares of stock on margin at a cost per share of $22. The initial margin requirement is 60%. The effective interest rate on the margin loan is 6.4%. How much interest will you pay if you repay the loan in four months?

• A)$68.77
• B)$91.93
• C)$102.16
• D)$112.38
• E)$117.04

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Definitions:

Prefrontal Cortex

A region of the frontal lobes of the brain implicated in a variety of complex behaviors, including planning, decision-making, and moderating social behavior.

Axons

Long, slender projections of nerve cells (neurons) that transmit electrical impulses away from the neuron's cell body to other neurons or muscles.

Dendrites

The branched extensions of neurons that receive electrical impulses from other nerve cells, facilitating inter-neuronal communication.

Synapses

The junctions between neurons that allow for the transmission of electrical or chemical signals across the nervous system.