Exhibit 20.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 17

Multiple Choice

Exhibit 20.2
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
A futures contract on Treasury bond futures with a December expiration date currently trade at 103:06. The face value of a Treasury bond futures contract is $100,000. Your broker requires an initial margin of 10%.
-Refer to Exhibit 20.2. If the futures contract is quoted at 105:08 at expiration calculate the percentage return.

• A)1.99%
• B)19.99%
• C)20.62%
• D)25.37%
• E)-13.65%

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Definitions:

Current Ratio

A financial ratio that evaluates a firm's capacity to cover its short-term liabilities using its existing assets.

Acid-Test Ratio

A financial metric that evaluates a company's ability to meet its short-term obligations with its most liquid assets, excluding inventory.

Marketable Securities

Financial instruments that are easily convertible into cash and are often used for short-term investments.

Current Liabilities

Financial obligations due within one year, including accounts payable, short-term loans, and taxes owed.