Question

Adam culbreath wanted to invest in the stock market, but didn't have the entire $10,000 he needed to buy the shares of the company he wanted. adam does have $7,000, so he decided to borrow the remainder of the stock's purchase price from his broker in order to be able to buy the stock he wanted. adam: is investing in junk bonds. is buying on margin. is purchasing delayed remittance stock. is involved in debt diversification.

Answer 1

Adam is buying on margin.

Step-by-step explanation:

When you buy a stock on margin it means that your broker borrowed you some of the money needed for the purchase of the stock.

In this case, Adam is buying stock on margin because he only had $7,000 and his broker lent him the extra $3,000 he needed to purchase the shares he wanted.