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    Question

    With respect to the futures transactions, the purpose of margin is to”

    A Make trades easier Correct Answer Incorrect Answer
    B Reduce price risk for futures investors Correct Answer Incorrect Answer
    C Provides security to the clearinghouse Correct Answer Incorrect Answer
    D All of the above Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Futures traders post margin as a security to the clearinghouse and it serves to ensure traders will fulfil their obligations.

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