In Order to Prevent Traders from Reneging on Futures Contracts

question 4

Multiple Choice

In order to prevent traders from reneging on futures contracts, exchanges require traders to maintain _____.

• A) micro accounts
• B) savings accounts
• C) credit accounts
• D) margin accounts

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Definitions:

Gross Requirements

The total demand for an item or component before any inventory on hand or scheduled receipts are considered.

Holding Cost

The expenses associated with storing unsold goods or inventory, including warehousing, insurance, and deterioration or obsolescence costs.

Setup Cost

Costs incurred to prepare equipment, machinery, or production lines for manufacturing a new product or batch.

ERP

Enterprise Resource Planning, a type of software that organizations use to manage and integrate important parts of their businesses, including finance, supply chain, operations, and human resources.