The Buyer of a Forward Contract

question 48

Multiple Choice

The buyer of a forward contract:

• A) Is obligated to make delivery and accept the forward price.
• B) Has the option of taking delivery and paying the lesser of the spot market price or the contract price.
• C) Has the option of making delivery and receiving the higher of the spot market price or the contract price.
• D) Is obligated to take delivery and pays the lower of the spot market price or the contract price.
• E) Is obligated to take delivery and pay the forward price.

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Definitions:

Glucose

Glucose is a simple sugar and a primary source of energy for the cells of the body, derived from food and used immediately or stored for future use.

Muscle Fatigue

A condition following physical activity characterized by a decrease in muscle power output, leading to reduced performance.

Lactic Acid

A substance produced in the muscles during strenuous exercise, often associated with muscle fatigue.

Contract

A voluntary agreement between two parties in which specific promises are made.