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

question 14

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

---

Definitions:

Rights

Legal, social, or ethical principles of freedom or entitlement; fundamental norms regarding what people are allowed to do or have.

Exclusionary Rule

A legal principle in the United States that prevents the government from using most evidence gathered in violation of the United States Constitution.

Supreme Court

The highest judicial authority in a country or state, responsible for interpreting the constitution and laws and reviewing lower court decisions.

Good Faith Exceptions

A legal principle allowing evidence collected in violation of privacy rights to be admitted in court if police believed they were following legal procedures.