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      Question

      What is the 'Margin' in the context of a bank

      loan?Β 
      A The profit the bank makes on the loan. Correct Answer Incorrect Answer
      B The borrower's contribution toward the cost of the project/asset. Correct Answer Incorrect Answer
      C The penalty charged for late payment. Correct Answer Incorrect Answer
      D The difference between Repo rate and Bank rate. Correct Answer Incorrect Answer
      E The total collateral value. Correct Answer Incorrect Answer

      Solution

      Margin is the portion of the asset's cost that the borrower must fund from their own resources, ensuring they have "skin in the game."

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