Table 18-3 -Refer to Table 18-3.The Table Above Outlines the Rankings of Outlines

question 68

Essay

Table 18-3

-Refer to Table 18-3.The table above outlines the rankings of three members of the U.S.Senate on three spending alternatives.Assume that Congress can spend additional revenue on only one of the three spending alternatives and that Bart, Lisa, and Maggie, all members of the Senate, participate in a series of votes in which they are to determine which of the spending alternatives should receive funding.Three votes will be taken: (1)Immigration Reform and Unemployment Benefits (2)Immigration Reform and Social Security Reform and (3)Unemployment Benefits and Social Security Reform.
Show the results of each vote and determine whether the voting paradox will occur as a result of these votes.

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Definitions:

Maintenance Margin

The minimum amount of equity that must be maintained in a margin account.

Margin Call

A demand by a broker that an investor deposit additional money or securities to cover possible losses.

Initial Margin

The minimum amount of equity that must be provided by an investor when purchasing securities on margin, acting as a down payment on the purchase.

Maintenance Margin

The minimum amount of equity that must be maintained in a margin account to continue holding an investment, after initiating a position.