The Forward Rate in a Forward Contract

question 37

Multiple Choice

The forward rate in a forward contract

• A)​is the spot rate at the expiration date of the contract.
• B)​changes as the spot rate changes.
• C)​is said to be at a discount if it exceeds the spot rate at the inception of the contract.
• D)​None of the above are true.

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Definitions:

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Individuals who have developed a skill in deceiving others through falsehoods, often doing so with ease and without guilt.

Polygraph Machine

A device used to measure and record physiological indicators such as blood pressure, pulse, and respiration while a person is asked questions, purportedly to detect lies.

Tensing Muscles

The act of contracting one's muscles tightly, often used as a relaxation technique by progressively tensing and then relaxing different muscle groups.

Cerebellum

A brain structure that regulates movement and balance, is involved in remembering simple skills and acquired reflexes, and plays a role in cognitive and emotional learning.