The Documents Signed When a Customer Opens a Brokerage Account

question 1

Multiple Choice

The documents signed when a customer opens a brokerage account

• A) establish a legal relationship between the customer and the brokerage firm.
• B) may be signed by a minor child provided that the money being invested belongs to the child.
• C) serve as an informal relationship between the customer and the stockbroker.
• D) limit the customer to dealing only through that brokerage firm.

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Definitions:

Semiannually

Occurring or payable twice each year.

Present Value Table

A table used to determine the present value of a cash flow or series of cash flows to be received in the future, based on a certain discount rate.

Loan Agreement

A legally binding contract between a borrower and a lender, detailing the terms and conditions of a loan.

Interest

The cost of borrowing money, typically expressed as a percentage of the principal amount, or the income earned from lending funds.