Three Hundred Shares of Stock Are Purchased on Margin at a Price

question 14

Essay

Three hundred shares of stock are purchased on margin at a price of $42 per share plus $150 in brokerage commissions at a time when the margin requirement is 50 percent.How much additional cash would you need to deposit with your broker if the price of the stock dropped to $37 per share?
(a)$825
(b)$1,500
(c)$1,650
(d)$5,550

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Definitions:

Interference Theory

A theory explaining that forgetting occurs because memories interfere with and disrupt each other, either by a process of proactive or retroactive interference.

Decay Theory

A hypothesis in psychology that suggests the reason for forgetting is the automatic fading or weakening of the memory trace over time.

Hormone

Chemical that carries messages throughout the body, potentially affecting a person’s mood, level of energy, and reaction to stress.

Degradation Inhibitor

A substance that prevents or slows down the breakdown or deterioration of another substance.