Which of the Following Is True for Futures Contracts

question 1

Multiple Choice

Which of the following is true for futures contracts?

• A)They do not have standardized terms.
• B)They have clearinghouses that guarantee the transactions.
• C)They are private contracts between two parties.
• D)The parties have a higher risk of defaulting on a contract.
• E)The settlement of a futures contract occurs at the end of the contract.

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Definitions:

Involuntary

Actions or reactions that occur without conscious choice, often used in legal contexts to describe commitments or actions not made of an individual's free will.

Voluntary Petition

A voluntary petition is a legal document filed by an individual or entity declaring their intention to undergo bankruptcy proceedings under their own accord.

Painting

The practice of applying pigment to a surface, such as canvas or paper, to create an image, artwork, or expression.

Bankrupt

The condition in which an individual or organization is unable to fulfill its financial obligations to lenders.