If an Investor Does Not Respond to a Margin Call

question 18

Multiple Choice

If an investor does not respond to a margin call, the broker will

• A) notify Reserve Bank so they can cover the call.
• B) sell some of the investor's holdings to cover the margin call.
• C) sell all of the investor's holdings and close their brokerage account.
• D) sell enough of the investor's holdings that the margin account can be closed.

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Definitions:

Congress

The bicameral legislature of the United States government, comprised of the House of Representatives and the Senate, responsible for making federal laws.

Slave Trade Ban

Legislation or measures implemented to prohibit the trade of enslaved individuals, such as the British Slave Trade Act of 1807 and the United States Act Prohibiting Importation of Slaves in 1808.

British Impressments

The practice employed by the British Royal Navy of forcibly enlisting men into military service, often involving the capture of sailors from American ships in the late 18th and early 19th centuries.