Which of the Following Describes a Forward Contango

question 47

Multiple Choice

Which of the following describes a forward contango?

• A)When the forward price is less than the spot price
• B)When the forward price is more than the spot price
• C)When the investor owns something
• D)When the investor owes something

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Definitions:

Demand Schedule

A table that shows the quantity of a good or service that consumers are willing and able to purchase at different prices.

Rent-Seeking Activity

Rent-Seeking Activity involves individuals or entities attempting to obtain economic rent by manipulating the social or political environment in which economic activities occur, rather than creating new wealth.

Demand Schedule

A table or graph showing the quantity of a good that buyers wish to purchase at various prices.

Natural Monopoly

A market structure where a single firm can supply a good or service to an entire market at a lower cost than two or more firms, often due to high fixed or infrastructure costs.