Dée Trader opens a brokerage account and purchases 400 shares of Internet Dreams at $28 per share.

Feb 3rd, 2012
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Dée Trader opens a brokerage account and purchases 400 shares of Internet Dreams at $28 per share. She borrows $3,000 from her broker to help pay for the purchase. The interest rate on the loan is 12%. a. What is the margin in Dée’s account when she first purchases the stock? b-1. If the share price falls to $18 per share by the end of the year, what is the remaining margin in her account? b-2. If the maintenance margin requirement is 30%, will she receive a margin call? c. What is the rate of return on her investment? (Negative value should be indicated by a minus sign.Round your answer to 2 decimal places.)

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