How many shares can you buy in total

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Reference no: EM132803212

You have $20,000 to invest and you have decided to buy Shake Shack (SHAK) on margin. Your broker requires an initial margin of 60% and a maintenance margin of 40%. Currently, Shake Shack is trading for $160 per share.

a. Approximately how many shares can you buy in total?

b. If the price drops to $120 per share, will you receive a margin call?

c. How far can the price fall before your broker issues a margin call?

Reference no: EM132803212

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