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Under an initial federal requirement of 70% equity, Bubba purchases 100 shares of XYZ at $40 per share and wishes to satisfy the margin call by delivering another listed security into his account.
He may do so by depositing stocks with a market value of:
Suggested Answer: A
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$9,333. If Bubba were depositing cash, he would need $2,800 (70% x $4,000). Since he is depositing stock, he would have to deposit enough with loan value of $2,800. To arrive at this, divide $2,800 by the 30% loan value to obtain $9,333.
12 comments · newest first
GL
Glenn
1 year ago
I thought it would be lower, like $5,714.
RE
Regenia
1 year ago
Wait, are we sure about that? Seems a bit high.
RA
Raul
1 year ago
Yeah, $9,333 sounds right to me too!
ES
Estrella
1 year ago
I think he needs to deposit $9,333 to meet that 70% requirement.
JO
Josefa
1 year ago
The total cost of the shares is $4,000.
ZO
Zona
1 year ago
I vaguely recall that the margin call amount is based on the total value of the shares. I hope I remember the right formula!
JA
Janna
1 year ago
If the initial requirement is 70%, then Bubba needs to cover that. I feel like I might be overthinking the numbers.
AV
Avery
1 year ago
I think we need to find out how much equity Bubba has after buying the shares. I practiced a similar question last week.
PE
Pearline
1 year ago
I remember something about calculating the equity requirement, but I'm not sure how to apply it here.
ER
Eric
1 year ago
Ah, I see now. The key is to create a new target group with the instances in both Availability Zones. That way, the NLB can properly distribute traffic across all the available instances. This seems like the most straightforward and operationally efficient solution.
KR
Kris
1 year ago
I'm a bit confused by this question. I'm not sure if a network peering or SDN solution would really be the best fit here. I think I'll go with the IPAM solution, as that seems to be the most relevant option based on the information provided.
LI
Linsey
1 year ago
Wasn't there something about positive reinforcement in class? I'm not completely certain, but I think options B and D touch on how the teacher's reactions might influence outcomes.