To Exploit an Expected Increase in Interest Rates, an Investor

question 50

Multiple Choice

To exploit an expected increase in interest rates, an investor would most likely

• A)sell Treasury bond futures.
• B)take a long position in wheat futures.
• C)buy S&P 500 Index futures.
• D)take a long position in Treasury bond futures.

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Definitions:

Gross Profit Method

A technique used to estimate the amount of ending inventory using the gross profit margin.

Net Realizable Value

The expected selling price in the ordinary course of business minus the estimated costs of completion and the costs necessary to make the sale.

Normal Selling Price

The standard amount charged to customers for a good or service under normal market conditions.

Beginning Inventory

The value of goods available for sale at the start of an accounting period, before any purchases or sales have occurred.