The Purpose of a Margin Account for a Futures Contract

question 44

Multiple Choice

The purpose of a margin account for a futures contract is to:

• A) guarantee a minimum margin of profit for the contract holder.
• B) allow futures traders to have more than one contract at once.
• C) provide a cushion for the exchange against defaults on the contract.
• D) hold interest payments until expiration.

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Definitions:

Knowledge Management

The systematic process of creating, sharing, using, and managing the knowledge and information of an organization to achieve its objectives.

Sharing Information

The act of disseminating knowledge, data, or insights among individuals or groups to facilitate collaboration or decision-making.

Competitive Advantage

The unique attributes or capabilities that allow an organization to outperform its competitors.

Socially Responsible

Refers to actions and policies of individuals or organizations that consider the well-being and fairness towards society and the environment.