The securities Investor Protection Corporation protects individuals from Quizlet

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$400,000

Coverage under SIPC may not exceed $500,000 in cash and securities, of which up to $250,000 may be cash. In the cash account, his coverage is $300,000 in securities plus $40,000 in cash. In the long margin account, the coverage is only the equity, which is $60,000. Total: $300,000 + $40,000 + $60,000 = $400,000.

A customer has a significant amount of money in bank deposit accounts: $225,000 in a savings account titled in the customer's name; $240,000 in a checking account titled jointly with a spouse; and $100,000 in an account where the customer is custodian for a grandchild. Should that bank fail, the Federal Deposit Insurance Corporation (FDIC) insurance would cover

A) $250,000 for the savings and checking accounts and $100,000 for the custodial account.
B) $225,000 for the savings account, $100,000 for the custodial account, and nothing for the checking account.
C) the entire $565,000.
D) a total of $250,000, divided proportionately among the three accounts.

A customer has a significant amount of money in bank deposit accounts: $225,000 in a savings account titled in the customer's name; $240,000 in a checking account titled jointly with a spouse; and $100,000 in an account where the customer is custodian for a grandchild. Should that bank fail, the Federal Deposit Insurance Corporation (FDIC) insurance would cover

A) the entire $565,000.
B) a total of $250,000, divided proportionately among the three accounts.
C) $225,000 for the savings account, $100,000 for the custodial account, and nothing for the checking account.
D) $250,000 for the savings and checking accounts and $100,000 for the custodial account.

An investor opens an account with BNZ Government Securities, a broker-dealer limiting its transactions exclusively to securities issued by the U.S. government. The account holds $250,000 of Treasury bonds, $250,000 of Treasury notes, and $50,000 in cash. If BNZ's broker-dealer business should fail, the investor would receive Securities Investor Protection Corporation (SIPC) protection in the amount of

A) all of the securities and all of the cash, because U.S. government securities do not go bankrupt.
B) $500,000 of the securities and none of the cash.
C) $0.
D) $50,000 of the cash and $450,000 of the securities.

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