What is dollar profit or loss per share

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a. If you bought GM at $25.00 and sold it at $30.00, what is your dollar profit or loss per share (ignoring transaction costs)? What is your holding period return? Show work.

b. Now assume that you posted 50 percent margin and borrowed the balance for each share you bought in part a. What is your holding period return for each share?

c. If the brokerage firm required a 35 percent maintenance margin, at what price would you receive a margin call from your broker?

d. Assume you receive the margin call AT the price you calculated in part c. Describe, exactly, the options your broker will offer you. Be very $pecific.

e. Which government institution sets minimum initial margin rates?

Reference no: EM132666074

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