Use the Table for the Question(s)below

question 86

Multiple Choice

Use the table for the question(s) below.
Consider the following list of projects:

-Assuming that your capital is constrained,so that you only have $600,000 available to invest in projects,which project should you invest in and in what order?

• A)CBFH
• B)CBGF
• C)BCFG
• D)CBFG
• E)CBGH

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Definitions:

Margin Call

A demand by a broker that an investor deposits further cash or securities to cover possible losses.

Initial Margin

The initial margin is the upfront investment required when buying on margin or entering a futures contract, acting as a security deposit for the trade.

Maintenance Margin

The minimum amount of equity an investor must maintain in a margin account after the purchase has been made, to keep the position open.

Interest Rate Swaps

Financial derivatives contracts where two parties exchange interest rate payments on a specified principal amount, typically exchanging fixed for floating rates.