The current price of a stock is $20 per share. You have $10,000 to invest. You borrow an additional $20,000 from your broker and invest $30,000 in the stock. If the maintenance margin is 30 percent, at what price will a margin call first occur? O A. $19.05 O B. $17.86 C. $14.28

The current price of a stock is $20 per share. You have $10,000 to invest. You borrow an additional $20,000 from your broker and invest $30,000 in the stock. If the maintenance margin is 30 percent, at what price will a margin call first occur? O A. $19.05 O B. $17.86 C. $14.28

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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The current price of a stock is $20 per share. You have $10,000 to invest. You borrow an additional $20,000 from your broker and invest $30,000 in the stock. If the
maintenance margin is 30 percent, at what price will a margin call first occur?
O A. $19.05
O B. $17.86
O C. $14.28

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