Suppose That a Futures Trader Has an Initial Margin of $2,000

question 7

Multiple Choice

Suppose that a futures trader has an initial margin of $2,000 in her brokerage account.The maintenance margin is 75 percent.If the equity in her account falls by $1,200,the account holder has to come up with a variation margin of:

• A) $300 in cash,or a letter of credit,or short-term Treasury securities
• B) $300 in cash
• C) $800 in cash,or a letter of credit,or short-term Treasury securities
• D) $800 in cash
• E) None of these answers are correct.

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Definitions:

Human Attraction

The process or quality that draws people together and fosters interest, desire, or affection towards others.

Reactivity

A response or change in behavior of a system or organism resulting from external or internal stimuli.

Observing from Distance

The act of monitoring or studying someone or something from a place that is physically removed from the subject to minimize interference or influence.

Study Disclosure

The act of informing participants about the nature, purpose, and potential risks of a research study before their participation.