Series 7 Exam Question 374: Answer and Explanation

Question: 374

Regarding margin accounts, which two of the following are TRUE?

I. Minimum maintenance on a long account is 25 percent.

II. Minimum maintenance on a short account is 25 percent.

III. Minimum maintenance on a long account is 30 percent.

IV. Minimum maintenance on a short account is 30 percent.

• A. I and II
• B. I and IV
• C. II and III
• D. III and IV

Correct Answer: B

Explanation:

B. The margin requirement for both long and short margin accounts is set at 50 percent. However, the minimum maintenance for a long account is 25 percent and the minimum maintenance for a short account is 30 percent.