SIE Exam Question 61: Answer and Explanation

Question: 61

What is the buying power in a margin account?

• A. The amount of available cash
• B. The amount of margin available to borrow
• C. The amount of available cash plus the amount able to be borrowed
• D. None of the above. Margin accounts do not have buying power.

Correct Answer: C

Explanation:

The buying power in a margin account is the amount of available cash plus the amount able to be borrowed. This is also called purchasing power.