The Repo Margin on a Repurchase Agreement Is Most Likely

question 21

Multiple Choice

The repo margin on a repurchase agreement is most likely to be lower when:

• A) the underlying collateral is in short supply.
• B) the maturity of the repurchase agreement is long.
• C) the credit risk associated with the underlying collateral is high.

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Definitions:

Superstructure

Superstructure in the context of Marxist theory, refers to the cultural, ideological, and institutional structures built upon the economic base (relations and means of production) of a society.

Matrilineal Descent

A system of lineage and inheritance through the female line.

Exclusive Authority

The power or right of an entity to govern or rule without any interference from others.

African Captives

Individuals from Africa who were forcibly taken from their homeland and sold into slavery, predominantly between the 16th and 19th centuries.