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10 December, 04:24

You are bearish on telecom and decide to sell short 100 shares at the current market price of $50 per share. How much in cash or securities must you put into your brokerage account if the broker's initial margin requirement is 50% of the value of the short position? (hw1)

a. 50

b. 2500

c. 5000

d. 7500

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Answers (1)
  1. 10 December, 04:38
    0
    The correct answer is B. 2,500

    Initial margin is 50% of $5,000, which is $2,500.
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