USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Heidi Talbott has a margin account with a balance of $50,000. The initial margin deposit is 50 percent, and RC Industries is currently selling at $50 per share.
-Refer to Exhibit 3.2. How many shares of RC can Heidi buy?
A) 2,500
B) 2,000
C) 1,000
D) 500
E) 250

Question

Quizplus · Accepted Answer

Heidi can buy shares worth twice her margin deposit due to the 50% initial margin requirement. With a $50,000 balance, she can purchase $100,000 worth of shares. At $50 per share, she can buy 2,000 shares.