Will Purchased 3 Futures Contracts on Corn

question 60

Multiple Choice

Will purchased 3 futures contracts on corn. The contract size is 5,000 bushels and the price is quoted in cents per bushel. Assume the initial margin requirement is 4.5% of the contract value. What is the amount of the initial margin if the futures quote is 624?

• A)$140.40
• B)$421.20
• C)$1,404
• D)$2,808
• E)$4,212

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Definitions:

Safety

The condition of being protected from or unlikely to cause danger, risk, or injury, often referenced in the context of health, environment, and work.

Control Group

A group in an experiment or study that does not receive the experimental treatment and is used as a benchmark to measure how the other tested subjects do.

Experimental Group

In research, a group of subjects who are exposed to the variable under investigation, as opposed to the control group which is not.

Comparisons

The act of evaluating two or more items to highlight their similarities and differences.