1. If you have a large yard which has been not used for any commercial purposes for a long time. Now you want to use this place to start a family business. Is the yard considered free for your business when you conduct a capital budgeting analysis of the project? Why?
2. You have a margin account with a balance of $125,000. The initial margin deposit is 55 percent. XLZ Industries is currently selling at $50 per share. What is your dollar profit if the stock rises to $65/share? What is your return?
3. If the maintenance margin is 25%, to what price can XLZ fall to before a margin call is made?