Kathy has a margin account with a balance of €60 000. Initial margin requirements are 80 per cent, and Jackson Industries is currently selling at €40 per share. How many shares of Jackson can Kathy buy?
A) 1875
B) 1500
C) 1750
D) 1200
E) None of the above

Question

Quizplus · Accepted Answer

Kathy can buy 1875 shares of Jackson. Initial margin = 80% of €60,000 = €48,000Number of shares = €48,000 / €40 = 1875 shares

Kathy Has a Margin Account with a Balance of €60