You deposit $100,000 cash in a brokerage account and purchase $200,000 of stocks on margin by...
You deposit $100,000 cash in a brokerage account and purchase $200,000 of stocks on margin by borrowing $100,000 from your broker. Later, the value of your stock holdings falls to $175,000. What is your account margin in dollars?
Homework Answers
Loss Incured =$2000,000-$175,000=$25000
Hence account margin=$100,000-$25000=$75000
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