Which of the Following Items Will a Short Bond Futures

question 23

Multiple Choice

Which of the following items will a short bond futures position be most interested in at expiration of the futures contract?

• A) Cash and carry
• B) Cheapest to deliver
• C) Conversion factor
• D) Implied Repo rate

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Definitions:

Market Forces

The natural factors of supply and demand that determine prices, production levels, and resource allocation in a freely competitive economy.

Resistance Price

A price level at which an asset meets pressure on its way up due to a concentration of selling interest, often used in technical analysis of financial markets.

Willingness to Pay

The maximum amount an individual or entity is prepared to spend to purchase a good or service or to avoid something undesirable.

Market Demand Curve

A graphical representation of the quantity of goods demanded at various prices by all consumers in the market.