Which One of the Following Statements Is True

Multiple Choice

Which one of the following statements is true?

A) When buying stock on margin, an investor borrows stock from the brokerage firm.
B) Usually, a bank arranges for the loan in a margin transaction.
C) Investors buy on margin because doing so offers them the potential to buy more stock and therefore earn larger returns.
D) The margin requirement is established by the New York Stock Exchange.
E) The current margin requirement is 25 percent.