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1. Trader opens a brokerage account and purchases 200 shares of Internet Dreams at $48 per share. She borrows $3,100 from her broker to help pay for the purchase. The interest rate on the loan is 5%. a. What is the margin in Dée's account when she first purchases the stock? Margin b. If the share price falls to $38 per share by the end of the year, what is the remaining margin in her account? (Round your answer to 2 decimal places.) Remaining margin % c. If the maintenance margin requirement is 30%, will she receive a margin call? Yes Ο Νο
d. 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.) Rate of return %

2.Suppose that you just purchased 350 shares of Talk&Tell stock for $90 per share. a. If the initial margin requirement is 87.50%, how much money must you borrow? (Round your answers to 2 decimal places.) Amount borrowed $ b. Construct the balance sheet that corresponds to the transaction. Assets Stock $ Liabilities and Equity Loan from broker Equity Total liabilities and equity $ $ Total assets $ $

3.The increase of a policy's cash value is subject to tax at ordinary income rates. • Insurance owned on the life of another is valued in a decedent's estate at face value.

4.Identify and elaborate the main difficulties associated with Price Earnings (P:E) Ratio and Discounted Cash Flow (DCF) for valuing companies which are not quoted in the Stock Market?

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