Explanation

The leverage ratio is calculated as the reciprocal of the margin requirement.

Formula: $\text{Leverage Ratio} = \frac{1}{\text{Margin Requirement}}$

Given:

• Minimum margin requirement = 55% = 0.55

Calculation: $\text{Leverage Ratio} = \frac{1}{0.55} = 1.81818...$

Rounding:

• 1.81818... ≈ 1.82

Why this is correct:

• When you have a 55% margin requirement, it means you need to put up 55% of the position's value as your own capital.
• The remaining 45% is borrowed.
• The leverage ratio represents how much total position you control relative to your equity.
• With 55% equity, you control 100% of the position, so leverage = 100/55 = 1.818.

Verification:

• Option A (1.55) would correspond to a margin requirement of 1/1.55 ≈ 64.5%
• Option C (2.22) would correspond to a margin requirement of 1/2.22 ≈ 45.0%

Therefore, the maximum leverage ratio is closest to 1.82.