Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. short sales (lo4, cfa3) you believe the stock in f

Short Sales (LO4, CFA3) You believe the stock in Freeze Frame Co. is going to...

50.1K

Verified Solution

Question

Accounting

Short Sales (LO4, CFA3) You believe the stock in Freeze Frame Co. is going to fall, so you short 600 shares at a price of $72. The initial margin is 50 percent. Construct the equity balance sheet for the original trade. Now construct equity balance sheets for a stock price of $63 and a stock price of $77. What is your margin at each of these stock prices? What is your effective annual return if you cover your short position at each of these prices in five months?

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!
Become a Member

Other questions asked by students

Q

Learning Target I can solve a system of equations by graphing and finding the intersection...

Algebra
Q

The management of a company is considering replacing a number of old looms in the mill’s...

Finance
Q

2. Which of the following is NOT correct with regard to the MCH I presentation complex? a. It...

Biology
Q

What might happen to blood pressure if epinephrine is administered alone. Draw a typical control diagram,...

Medical Sciences
Q

Make sure to scroll left and right to see full question and please show work. Waterway...

Accounting
Q

Male Have Read 19 Have Not Read 57 Total 76 Reading Harry Potter and gender...

Geometry
Q

I 3 ko y 1 245 1 Viller and c 80 and a 106 find...

Algebra
Q

Piscataway Plastics Company manufactures a highly specialized plastic that is used extensively in the automobile...

Accounting
Q

Moore Manufacturing Inc., a profitable company, sells a product for $10 per unit. The variable...

Accounting
Q

Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication...

Accounting
Q

Castor Incorporated is preparing its master budget. Budgeted sales and cash payments for merchandise purchases...

Accounting
Q

Pippen Co Balance Sheet For the period ended 12/31/X1 ($000) ...

Finance