Evan Purchased a Futures Contract on Treasury Bonds at a Price

question 61

Multiple Choice

Evan purchased a futures contract on Treasury bonds at a price of 102-12. Two months later, Evan sells the same futures contract in order to close out the position. At that time, the futures contract specifies 103-15. What is Evan's nominal profit? The par value of the futures contract is $100,000.

• A)$1,030.00; profit
• B)$1,030.00; loss
• C)$1,093.75; profit
• D)$1,093.75; loss
• E)None of these are correct.

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Definitions:

Oil Shale

A sedimentary rock consisting of organic materials that can be processed to produce shale oil, a type of unconventional petroleum.

Geologic Structure

The arrangement and relationship of rock layers and formations, shaped by tectonic forces, that reveals the history of Earth's crust.

Anticlines And Synclines

Geological features where rock layers are folded upwards to form ridges (anticlines) and downwards to form troughs (synclines), often due to tectonic forces.

Thrust Faults

A type of fault where rocks on one side are pushed up and over rocks on the other, often associated with mountain building.