CUSTOMER ACCOUNT 3 UPDATED ACTUAL EXAM QUESTIONS CORRECT ANSWERS GRADED A

CUSTOMER ACCOUNT 3 UPDATED ACTUAL EXAM QUESTIONS CORRECT ANSWERS
GRADED A PLUS




Question:
In an existing margin account, a customer buys 1 ABC Jan 35 Put @ $4 when the market price of
ABC is $34. The customer must deposit: A. $200 B. $400 C. $3,400 D. $3,500.

Answer:
b 100*4=400



Question:
A customer has a fully paid options position and is long marginable stock. Subsequently he receives
a margin call on his long stock position. Which of the following statements are TRUE? I The
customer can borrow against long options contracts to satisfy a portion of the margin call II The
customer cannot borrow against the long options contracts to satisfy the margin call III Long option
contracts have a loan value of 0% IV Long option contracts have a loan value of 50% A. I and III B.
I and IV C. II and III D. II and IV.

Answer:
c



Question:
Regulation T sets the initial margin requirement to buy LEAP options with over 9 months to
expiration at 75% of the purchase amount. However, once a LEAP has 9 months or less to
expiration, the margin increases to 100% - the same as buying a regular option contract.

Answer:




Question:
An option with over 9 months to expiration held in a margin account has: A. no loan value B. a 25%
loan value C. a 50% loan value D. a 75% loan value.