Which of the Following Statements Is Not Correct? in a Repo

question 18

Multiple Choice

Which of the following statements is not correct? In a repo:

• A)the seller of the security is the borrower of funds.
• B)the price of repurchase is known from the beginning of the financial arrangement.
• C)the difference between the repurchase price and the selling price is the interest on the loan.
• D)if the borrower defaults on the repayment of the loan he/she then has to deliver the underlying securities to the lender.

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Definitions:

Census Family

A concept used in population census to refer to a group of people living together who are related by blood, marriage, common-law partnership, or adoption.

Family of Procreation

The family unit one creates through marriage or by having children, as opposed to the family of origin into which one is born.

Conjugal Family

A family unit formed by a married couple and their children, characterized by a legal and social recognition of their relationship.

Family of Orientation

The family into which an individual is born or adopted, contrasting with the family they may create through marriage or cohabitation (family of procreation).