Margin Accounts Have the Effect of

question 16

Multiple Choice

Margin accounts have the effect of

• A) Reducing the risk of one party regretting the deal and backing out
• B) Ensuring funds are available to pay traders when they make a profit
• C) Reducing systemic risk due to collapse of futures markets
• D) All of the above

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Definitions:

Vigorously On Price

An expression that may not accurately define a specific economic term but suggests active competition or negotiation around prices. NO.

Bargaining Power

The relative capacity of parties in a negotiation to exert influence over each other, often influencing the terms and conditions of agreements.

Dominant Firms

Companies that have a major share of the market sales or exert significant influence in their industry.

Contestable Market

A market structure where there are no barriers to entry or exit, and hence, firms face potential competition.