Assume you purchased 100 shares of common stock at $50 per share using 2,500 of your own money.The initial margin requirement is 50%.If the maintenance margin is 30%,at what prince would you get a margin call?

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The initial margin requirement is 50%, which means you were required to put down 50% of the cost, or $2,500 in this case. This means the total cost of the purchase was $5,000 ($2,500 / 50%).

The maintenance margin is 30%, which means you need to maintain at least 30% of the total value of the stock in your account.

To calculate the price at which you would get a margin call, you need to know how much the stock would have to fall before your account value drops to the maintenance margin level.

The formula for this is:

Margin call price = (Purchase price - (Maintenance margin * Purchase price)) / (1 - Maintenance margin)

Margin call price = ($50 - (0.3 * $50)) / (1 - 0.3)

Margin call price = $35.71

Therefore, if the stock falls to $35.71 or below, you would get a margin call.

Assume You Purchased 100 Shares of Common Stock at $50