Marking to Market Refers to

question 30

Multiple Choice

Marking to market refers to

• A)the determination of the prices of options contracts by the interaction of demand and supply.
• B)the determination of the prices of futures contracts by the interaction of demand and supply.
• C)the settlement of gains and losses on futures contracts each day.
• D)the settlement of gains and losses on forward contracts each day.

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Definitions:

Logistic Regression

A statistical method used for predicting a binary outcome from one or more predictor variables, modeling the probability of occurrence of an event by fitting data to a logistic curve.

Indicator Variable

An indicator variable is a numerical variable used in statistics that adopts a value of 1 if a certain condition is met and 0 if it is not.

Binomial Probability

The probability of obtaining a fixed number of successful outcomes in a fixed number of trials in a binomial experiment.

Odds

The ratio of the probability of an event happening to the probability of it not happening; in gambling, it represents the amount won relative to the stake.