Suppose That You Sold a Futures Contract for $3

question 17

Multiple Choice

Suppose that you sold a futures contract for $3.75 per bushel and the contract ended at $3.60 after several days of closing prices of $3.80, $3.70, $3.65, $3.70, $3.65, and $3.60. What would the mark to market sequence be? (Cash flow per bushel, in $.)

• A)−0.05, 0.10, 0.05, −0.05, 0.05, 0.05
• B)0.05, −0.10, −0.05, 0.05, −0.05, −0.05
• C)−0.05, 0.05, 0.10, 0.05, −0.09, −0.15
• D)0.05, −0.05, −0.10, −0.05, −0.09, −0.015

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Definitions:

Nuclear Family

A social unit composed typically of two parents and their children, living together as a family.

Full-Time

Employment in which a person works a minimum number of hours defined as such by their employer, typically for five days a week.

Extended Family

A family that extends beyond the nuclear family, including grandparents, aunts, uncles, and other relatives, who all live nearby or in one household.

Immigrated

The action of moving to a new country or region with the intention of settling and living there permanently.