How much of your own money have you used

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Reference no: EM131810764

You buy 200 shares of GOOG at $70 per share. you borrow from your broker and your margin is 60%.

A. How much of your own money have you used? And after suprisingly horrible earnings news the price of GOOG shares falls to $30 per share. What is your margin now?

B. Your account has a maintenance margin of 30% You receive a margin call from your broker. This means that you will have to pay of some of the loan the broker made to you, until your margin is above the maintenance margin. How much cash do you put into your account? Jow much of the loan do you pay off?

C. Suppose you were on holoday while GOOG was crashing, and you did not see the messages your broker left you about the margin call. The broker then sells some of your GOOG shares at the current market price to pay down your loan. How many shares does he sell? How much do you owe your broker now?

Reference no: EM131810764

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