What Is the Purpose of a Margin Account and Using

question 257

Multiple Choice

What is the purpose of a margin account and using margin to purchase stocks?

• A)A margin account allows you to purchase stocks without using any of your own money.
• B)A margin account allows you to purchase more shares than you could afford to purchase using only your own money.
• C)Using margin to purchase more shares gives you the potential to earn a higher return on your investment.
• D)All of the above are correct.
• E)Only B and C are correct.

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Definitions:

Tautology

A redundant or unnecessary statement in which the conclusion is inherent in the premise, offering no new information.

Bi-conditional

A logical condition where two statements are both necessary and sufficient for one another; if and only if (iff).

Tautology

A redundant or repetitive statement in which the conclusion is equivalent to the premise, offering no additional insight.

Logic of Statements

The study of principles and criteria for evaluating deductive arguments and the structural relationships between statements.