When Your Broker Sees That You Are in Danger of Running

question 11

Multiple Choice

When your broker sees that you are in danger of running through your money and forces you to sell your stock and use the money to pay back your loan, the broker is making a:

• A) margin call.
• B) leverage call.
• C) stock sales call.
• D) futures call.

---

Definitions:

Take Possession

Take possession refers to the act of assuming physical control or ownership of a piece of property or asset.

Collateral

Assets promised as security for the repayment of a loan, which can be seized by the lender if the borrower fails to repay according to the terms of the loan agreement.

Security Agreement

A legal document that provides a lender a security interest in a specified asset or property that is pledged as collateral.

Collateral

Collateral refers to assets that a borrower offers to a lender to secure a loan, which can be seized if the loan is not repaid.