Which One of the Following Describes a Short Position

question 71

Multiple Choice

Which one of the following describes a short position?

• A)Purchasing a security on margin
• B)Selling a security that you originally purchased on margin
• C)Loaning a security to your broker to cover a margin call
• D)Having less equity than required in your margin account
• E)Selling a security that you do not own

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Definitions:

Agent

An individual or entity authorized to act on behalf of another person or entity in contractual or legal matters.

Liquidation

The process of bringing a business to an end and distributing its assets to claimants, often in the context of bankruptcy.

Corporate Assets

Items of value owned by a corporation, including physical items as well as intangible rights and resources.

Distributed

The process or state of spreading or dispersing something more widely.