One Role That Markets Play Is

question 115

Multiple Choice

One role that markets play is

• A)to allocate resources.
• B)provide revenues for governments to spend.
• C)distribute income equally.
• D)provide for all human wants.

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Definitions:

Risk-Free Interest Rate

The hypothetical gain from an investment that is free from any risk of financial loss, frequently depicted by the government bond yield.

Futures Price Quote

A statement of the current market price for a futures contract, which is an agreement to buy or sell an asset at a future date at an agreed-upon price.

Expire

To come to an end or cease to be valid, as in the expiration of a contract, policy, or agreement.

Spot-Futures Parity

A financial theory stating that the spot and future prices of a commodity, currency, or security will converge at the futures contract's expiration.