Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams at...
90.2K
Verified Solution
Link Copied!
Question
Finance
Old Economy Traders opened an account to short sell 1,000 shares of Internet Dreams at $42 per share. The initial margin requirement was 50%. (The margin account pays no interest.) A year later, the price of Internet Dreams has risen from $42 to $53.
What was the initial margin you had to add to the account?
A. $42,000
B. $21,000
C. $53,000
D. $10,000
What was the amount you walk away with when you close the short sale position?
A. $42,000
B. $21,000
C. $53,000
D. $10,000
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
