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FINRA Series 7

Category - Series 7

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Regulation T is set at 50%. Bubba’s account contains long positions in the following securities with the prices listed
100 ABC $30
200 XYZ $70
200 QBB $40
200 KKK $25
Total market value = $30,000
Debit balance in the account = $12,000
Net equity balance of the account = $18,000

What is the buying power in Bubba’s account?

$3,000
$6,000
$11,000
$0

Explanation

Answer: B - $6,000. Divide Bubba’s excess equity by the Reg T margin requirement of 50%.

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