Julie Purchased Four S&P 500 Index Futures at a Price

question 86

Multiple Choice

Julie purchased four S&P 500 index futures at a price of 1392. The contract size is $250 times the index value. The futures are maturing today at a price of 1387.5. What is the amount of her profit or loss?

• A)−$3,125
• B)−$4,500
• C)−$5,625
• D)−$13,575
• E)−$15,625

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Definitions:

Rack-and-pinion

A type of linear actuator that comprises a circular gear (the pinion) engaging a linear gear (the rack), converting rotary motion into linear motion.

Parallelogram Steering

A steering linkage design in many vehicles where the linkage forms a parallelogram, allowing the wheels to move parallel to each other during turns.

Linkage Components

Various mechanical parts that connect together to transmit motion in order to perform a specific task.

Tie-rods

Components in a vehicle's steering system that help transfer the movement from the steering rack or center link to the steering knuckle, thus making the wheels turn.