You Want to Buy $10,000 of Securities in Your Margin

question 115

Multiple Choice

You want to buy $10,000 of securities in your margin account. Your advisor has informed you that you must pay a minimum of $65,000 or 6.5% of the purchase price in cash and thereafter maintain a minimum equity position of 30%. The initial margin requirement is ___ and the maintenance margin is ____

• A) 35%; 30%
• B) 35%; 70%
• C) 65%; 30%
• D) 65%; 35%
• E) 65%; 70%

---

Definitions:

Common Law Rule

Pertains to rules or principles developed through historical court decisions, forming a significant part of the legal framework that governs certain issues or cases.

Uniform Acts

Model statutes drafted by legal experts to promote uniformity and consistency in state laws on certain subjects across the United States.

Treaty

A formally negotiated and ratified agreement between or among countries.

Convention

A formal agreement between states, often a treaty, or a large meeting or conference, especially of members of a profession or a political party.