Beta Division Had the Following Information: What Is the Residual

question 57

Multiple Choice

Beta Division had the following information: What is the residual income for Beta Division?

• A) £60,000
• B) £48,000
• C) £7,500
• D) £(10,000)

---

Definitions:

Margin Call

A demand by a broker for an investor to deposit additional funds or securities to maintain the required minimum margin account balance.

Short Sale

A transaction where an investor borrows a security and sells it on the open market, planning to buy it back later at a lower price.

Maintenance Margin

The minimum amount of equity that must be maintained in a margin account after a purchase has been made, to continuing holding the position.

Secondary Markets

Markets where investors buy and sell securities or assets from other investors, rather than from issuing companies directly.