The Normal Initial Margin Requirement for Commodities or Financial Futures

question 49

True/False

The normal initial margin requirement for commodities or financial futures ranges from about 2% to 10% of the value of the contract.

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Definitions:

FIFO Method

An inventory valuation method that assumes the first items placed in inventory are the first sold, standing for "First In, First Out."

Periodic Inventory System

A system where inventory levels and the cost of goods sold are determined at the end of the accounting period through physical inventory counts.

Credit Memo

A document issued by a seller to a buyer, reducing the amount the buyer owes to the seller under previous transactions.