Reference no: EM133074621

1) You borrowed $8,000 to purchase 300 shares of Stock Y at $40 per share. The interest rate on the loan is 8%. The maintenance margin ratio is 30%. Below what stock price will you receive a margin call?

a) 40.56

b) 41.15

c) 44.62

d) 38.67

2) Continued with previous question. Suppose the margin trader wants to limit his investment return no worse than -10%, what order instruction should he give with the margin position?

a) stop-buy order

b) stop-loss order

c) limit buy order

3) Continued with the previous questions. What stop price should the trader give to limit his return no worse than -10%

a) $36.5

b) $38.4

c) $37.6