13. Which of the following statements is INCORRECT about trading on margin A. It is a...

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13. Which of the following statements is INCORRECT about tradingon margin A. It is a leveraged equity investment. B. Stockspurchased on margin are registered in street name. C. It increasespayoff both on the upside and downside. D. In general, a limit-buyorder may be placed to limit potential losses.
17. Consider the following short saleexample: an investor borrows 100 shares of a stock from the broker,put down 50% as the initial margin, and sells the stock at$50/share in the market. If the maintenance margin is 30%, how muchcan the stock price rise before the investor gets a margincall?
      A.56.79
      B.57.69
      C.59.69
      D.58.79
18. Regarding the previous question,suppose the stock price later goes up from $50/share to $75/share,put a ____________may limit the potential loss for theinvestor?
      A.limit sell order at $60/share
      B.limit buy order at $60/share
      C. stoploss order at $60/share
      D. stopbuy order at $60/share

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Answer to question number 13 Margin trade refers to the trade wherein the broker allows the trader to buy more shares by letting them borrow money for a period generally by keeping an See Answer

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13. Which of the following statements is INCORRECT about tradingon margin A. It is a leveraged equity investment. B. Stockspurchased on margin are registered in street name. C. It increasespayoff both on the upside and downside. D. In general, a limit-buyorder may be placed to limit potential losses.17. Consider the following short saleexample: an investor borrows 100 shares of a stock from the broker,put down 50% as the initial margin, and sells the stock at$50/share in the market. If the maintenance margin is 30%, how muchcan the stock price rise before the investor gets a margincall? A.56.79 B.57.69 C.59.69 D.58.7918. Regarding the previous question,suppose the stock price later goes up from $50/share to $75/share,put a ____________may limit the potential loss for theinvestor? A.limit sell order at $60/share B.limit buy order at $60/share C. stoploss order at $60/share D. stopbuy order at $60/share