A Cotton Producer Has Purchased Cotton Futures That Involve 50,000

question 82

Multiple Choice

A cotton producer has purchased cotton futures that involve 50,000 pounds of cotton at a price of $0.60 per pound.By contract expiration the producer finds that cotton prices have declined by $0.07 per pound.As a result of the futures contracts,the producer will:

• A) lose $3,500 per contract in the futures market which offsets gains in the cash market.
• B) gain $3,500 per contract in the futures market which offsets losses in the cash market.
• C) lose $3,500 per contract in the futures market and suffer an opportunity cost in the cash market.
• D) gain $3,500 per contract in the futures market and gain $0.10 per pound in the cash market.

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Definitions:

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People from Germany who have moved to another country, historically significant in shaping the demographics and culture of various nations, especially the United States.

Ethnic And Religious Diversity

The presence and acceptance within a society of a variety of cultural, ethnic, and religious groups.

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A pivotal event in British history (1688) marking the overthrow of King James II and the establishment of William III and Mary II as co-rulers, leading to the constitutional monarchy.