You open a brokerage account on january 1 and sell short, Ask an Expert

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You open a brokerage account on January 1 and sell short 500 shares of Apple Computer at $163.39 per share. The initial margin requirement is 50%. Assume that Apple pays an annual dividend on December 31 of $5.50 per share. What is the margin balance on December 31 after the dividend has been paid if the price of the stock is $140 per share? There is no interest paid in this margin account.

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Financial Management, Finance

Category:- Financial Management
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