MARGIN ACCOUNT. You have a Margin Account. Assume you buy 300 Pfizer (PFE) shares at $140...

MARGIN ACCOUNT. You have a Margin Account. Assume you buy 300 Pfizer (PFE) shares at $140 per share. You put up $21,000 and borrow the rest. Assume you buy 300 Pfizer (PFE) shares at $140 per share. You put up $21,000 and borrow the rest.

i. What is the Margin?

ii. How would this be represented in the balance sheet?

iii. Now assume that your margin account requires a maintenance margin of 40%. If PFE is selling for $110, would you receive a margin call? Why?

Expert Solution

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jeff jeffy answered 1 year ago

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