What will be your return on your investment

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Reference no: EM132184092

Question - You have decided to take a short position in GM, which is currently priced at $40 per share.

a. How much do you have to put into your margin account in order to be able to short 100 shares?

b. At what price will you receive a margin call assuming a maintenance 25% margin requirement?

c. What will be your return on your investment if GM stock price goes to $45 per share and pays a $0.75 dividend over the course of the next year?

Reference no: EM132184092

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