The existence of the principal-agent problem: Select one: A. increases the risk of buying stock in a corporation B. implies that managers that have the same incentives as the board of directors C. increases the risk of becoming the sole proprietor of a business D. does all of the above.

You are bearish on telecom and decide to sell short 100 shares at the current market price of $50 per share. a. how much in cash or securities must you put into your brokerage account if the broker’s initial margin requirement is 50% of the value of the short position? b. how high can the price of the stock go before you get a margin call if the maintenance margin is 30% of the value of the short position? (input the amount as a positive value. round your answer to 2 decimal places.)