Which of the following items is specified in a

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63. Which of the following items is specified in a futures contract? I) the contract size II) the maximum acceptable price range during the life of the contract III) the acceptable grade of the commodity on which the contract is held IV) the market price at expiration V) the settlement price A. I, II, and IV B. I, III, and V C. I and V D. I, IV, and V E. I, II, III, IV, and V The maximum price range and the market price at expiration will be determined by the market rather than specified in the contract. Difficulty: Moderate 64. Which of the following items is not specified in a futures contract? I) the contract size II) the maximum acceptable price range during the life of the contract III) the acceptable grade of the commodity on which the contract is held IV) the market price at expiration V) the settlement price The maximum price range and the market price at expiration will be determined by the market rather than specified in the contract. Difficulty: Moderate 22-33
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Chapter 22 - Futures Markets 65. With regard to futures contracts, what does the word "margin" mean? The exchange guarantees the performance of each party, so it requires a good-faith deposit. This helps avoid the cost of credit checks. Difficulty: Easy 66. Which of the following is true about profits from futures contracts? The net profit on the contract is zero - it is a zero-sum game. Difficulty: Moderate 22-34
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Chapter 22 - Futures Markets
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  • Spring '10
  • HAMZA
  • oil futures

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