You short sold 500 shares of Jasper stock at $41 a share at an initial margin of 60 percent.What is the highest the stock price can go before you receive a margin call if the maintenance margin is 40 percent?

Name: You short sold 500 shares of Jasper stock at $41 a share at an initial margin of 60 percent.What is the highest the stock price can go before you receive a margin call if the maintenance margin is 40 percent?
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Question

Quizplus · Accepted Answer

P* = {[(500 × $41) + (500 × $41 × 0.60)] / 500} / (1 + 0.40) = $46.86

You Short Sold 500 Shares of Jasper Stock at $41