If a Speculator Is Short and the Price of the Commodity

question 14

Multiple Choice

If a speculator is short and the price of the commodity rises, the individual
1. can expect a margin call
2. may take profits out of the position
3. may close the position at a loss

• A)1 and 2
• B)1 and 3
• C)2 and 3
• D)all of the above

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Definitions:

Pepsi

A global brand of carbonated soft drinks produced and manufactured by PepsiCo.

Marginal Utility

The extra pleasure or advantage gained by using an additional unit of a product or service.

Total Utility

The total satisfaction or benefit received by consuming a product or service.

Budget Line

A graphical representation showing all possible combinations of two goods or services that a consumer can afford with their income, given the prices of the goods.