509. Call Rates. - The broker borrows money on call. That is, any time. The rate of interest (See § 458.) In time of panic, "Money easy the bank may demand payment at on such loans is usually very low. however, it may rise very high. rates are low, say 14% to 3%. 510. Stockbroker's Account. 66 Money easy" means that call Call rates stiff" means 4% to 7%. The form of the stockbroker's ac count may be studied by means of an example. Example. On Jan. 12th, A. S. Walker sends $3000 to his broker, John Henry, instructing him to buy 300 shares of U. S. Steel as soon as it can be bought at 74. The broker buys the stock on Jan. 19. Under instruction from Mr. Walker, he sells it Jan. 31 at 75%. How much is due Mr. Walker? The following is the broker's statement: Interest is allowed on the margin from the time it is received until the account is closed. Interest is charged on the cost of the shares from the day they are bought until they are sold. Brokerage of 1% is charged both for buying and selling. If the market price of a stock bought on margin should fall, the broker will notify his customer to furnish additional margin. If this is not done, the broker may sell the stock to cover the loan he has made and to pay the brokerage. WRITTEN EXERCISES Prepare statements for the following: 1. May 1, Mr. R. A. Lord sent $5000 to his broker, H. L. Moore. May 4, Moore bought 200 shares C. M. & St. P. R.R. at 98, 200 shares C. & N.W. at 105 on May 7, and 100 shares Ill. Central on May 8 at 56%. Sold 100 shares Ill. Central May 12 at 561, 200 shares C. M. & St. P. on May 15 at 991, 200 shares C. & N.W. on May 18 at 107%. Interest 4%. Statement dated May 18. NOTE. ment. The receipts from the sales draw interest till the day of settle 2. A. R. Samuels furnished $2500 margin for which his broker bought 250 shares of Erie R.R. for 561, on June 7. On June 19 the broker sold the stock for 511⁄2 to protect himself. Rate of interest 41%. 3. A broker bought for Martin A. Smith 600 shares of N. Y. C. 108, Feb. 7, 200 shares Erie R. R., 591; Feb. 11, 400 shares N. H. & H., 743. February 9 sold 200 shares Erie R. R., 60; Feb. 13 sold 600 shares N. Y. C., 1073; Feb. 17, sold 400 shares N. H. & H., 76%. Margin 10% forwarded Feb. 3. Interest 3%. DRILL IN FUNDAMENTALS Find the rates of income on the investments given below. CHAPTER XXXV GRAPHIC REPRESENTATION 511. Uses of the Graph. The graph is used to represent statistical information directly to the eye by means of some sort of diagrammatic representation of the figures involved. Prices of commodities, the market values of stocks and bonds, variations in wages and in profits are but a few of the many kinds of facts which are frequently represented by graphs. 512. Representation of Population Statistics. On this page is a copy of a figure used in the report of the 13th census to represent the nationality of the foreign-born persons in the United States in 1900 and in 1910. The numbers used represent the percentage of the total foreign-born population which was born in each country. Foreign-born population, by principal countries of birth: 1910 and 1900. Total foreign-born, 1910: 13,515,886. Total foreign-born, 1900: 10,341,276. 513. Industrial Statistics. On the opposite page is a graphic representation of the value of products of different industries as given by a recent census. Example. From the data given on this page, find the per cent of value of all products produced by the different industries. After computing the per cents required to fill out the above table, make a graph representing these receipts. The beginning of this graph is shown in the lower part of the figure on the opposite page. In practice a very large variety of graphic representation is used. Thus men of different sizes are used to compare armies, ships of different sizes to compare navies. Very many such representations are self-explanatory. On the other hand the problem of selecting the most fortunate type of graphic representation in the various cases that arise is a very difficult one. In this field there is still room for much ingenuity and originality. A visit to the offices of a large concern such as a broker's office or a manufacturing company would reveal varied and interesting uses of graphs. |