Stephen is purchasing 700 shares of KPT, Inc., stock at a price per share of $20.80. What is the minimum amount the Federal Reserve will require Stephen to pay in cash for this purchase?

Federal Reserve will require Stephen to pay $7,280 in cash for this purchase

Explanation:

There is a legal requirement from the federal that for an investor to deposit 50% cash of the purchase of shares / securities value in the margin account. It is called the margin requirement.

Purchase Value = Number of shares x Price per share

Purchase Value = 700 shares x 20.8

Purchase Value = $14,560

Inityial Margin Requirement = $14,560 x 50% = $7,280

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

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