You sell short 2000 shares of abc at 25 for 4 months the


You sell short 2000 shares of ABC at $25 for 4 months. The initial and maintenance margin are 40%.

Assume the stock price is $30 in 4 months.

a) Construct a new balance sheet.

b) Are you subject to a margin call?

c) Calculate your rate of return.

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Finance Basics: You sell short 2000 shares of abc at 25 for 4 months the
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