Exhibit 20.1 Use the Information Below for the Following Problem(S)

question 49

Multiple Choice

Exhibit 20.1
Use the Information Below for the Following Problem(S)
December futures on the S&P 500 stock index trade at 250 times the index value of 1187.70. Your broker requires an initial margin of 10% percent on futures contracts. The current value of the S&P 500 stock index is 1178.
-Refer to Exhibit 20.1.How much must you deposit in a margin account if you wish to purchase one contract?

• A) $267,232.5
• B) $29,450
• C) $29,692.50
• D) $30,000
• E) $265,050

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