Darlene Law has enough money to purchase 1,000 shares of stock in ABC Corporation.If she buys on margin,she can purchase an additional 1,000 shares.What is the margin?

Question

Quizplus · Accepted Answer

Margin is the amount of money paid upfront by the investor in order to purchase stocks on credit. In this case, Darlene Law has enough money to purchase 1,000 shares of stock in ABC Corporation. If she buys on margin, she can purchase an additional 1,000 shares. This means that she is paying for half of the shares upfront (1,000 out of 2,000), which is a margin of 50%. Therefore, the correct answer is choice C.

Darlene Law Has Enough Money to Purchase 1,000 Shares of Stock