Which of the following best explains the functionality of a margin account?

A margin account is specifically designed to enhance an investor's purchasing power by allowing them to borrow money from a brokerage firm against the value of the securities held in the account. This function enables investors to leverage their investments, potentially amplifying their returns on investment. When utilizing a margin account, investors can buy more securities than they could with just their own cash, as they can borrow a portion of the purchase price.

This borrowing ability is what distinguishes margin accounts from regular cash accounts, where transactions must be fully funded with the investor's own capital. While it is true that margin accounts can be used for various trading strategies, including short selling, their primary functionality centers on the ability to borrow against securities, making option B the correct choice.