Consider the Following Data: YBM's Stock Price Is $110

question 16

Multiple Choice

Consider the following data: YBM's stock price is $110.The initial margin is 50 percent and the maintenance margin is 25 percent.If you buy 150 shares,borrowing 50 percent from the broker,at what stock price will you start to receive a margin call? (Hint: use the formula Margin= (Market value of assets - Loan) / Market value of assets. )

• A) $25
• B) $55.25
• C) $66.67
• D) $73.33
• E) None of these answers are correct.

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