An Investor Receives a Margin Call Because

question 46

Multiple Choice

An investor receives a margin call because

• A) the value of the stock that was sold short has decreased below a price specified by the broker.
• B) the brokerage firm wants to provide her with information about a new public stock issue that it will be handling in the future.
• C) interest rates in the financial markets have increased substantially,and the brokerage firm wants her to immediately repay the loan she has outstanding.
• D) the Federal Reserve intends to sell a special issue of Treasury securities and it needs investors to subscribe to the issue as quickly as possible.
• E) the price of the stock she purchased on margin has decreased enough so that the actual margin is below the maintenance margin.

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Definitions:

Collectivistic Cultures

Societies that prioritize the group over individual interests, emphasizing community and cooperation.

Collectivistic Cultures

Societies that prioritize the needs and goals of the group over those of the individual, emphasizing interdependence, cooperation, and social harmony.

Individualistic Cultures

Societies that emphasize personal achievements and rights, prioritizing individual liberty and independence over collective goals.

Industrialised Cultures

Cultures that have experienced significant development in technology, industrial production, and economic growth, impacting societal norms and lifestyles.