Tesla Motor share price = $200
No of shares = 2500 shares
Total Value = 2500*$200 = $ 500000
Investor short the shares of Tesla which means the margin call will be required if share price rises above $200 incurring loss for the investor.
Margin Requirement = 25%
lets assume Margin Call price be X
Margin % = Equity in Value/value of Stock
0.25 = (2500X - 500000)/2500X
625X = 2500X - 500000
X = $ 266.66
So, margin Call price will be $ 266.66. hence, Option C
SC ous efforts to identify inefficiencies in the market QUESTION 5 An investor shorts 2500 shares...