Which of the Following Would Result in a Profit on a Futures

question 14

Multiple Choice

Which of the following would result in a profit on a futures contract when the underlying currency depreciates?

• A)Buy a futures contract; sell a futures contract aFter the currency has depreciated.
• B)Sell a futures contract; buy a futures contract aFter the currency has depreciated.
• C)Buy a futures contract; buy an additional futures contract aFter the currency has depreciated.
• D)None of the above would result in a profit when the underlying currency of the futures contract depreciates.

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Definitions:

Forecast Period

The specific time period in the future for which forecasts of variables such as demand, costs or weather are made.

Qualified People

Individuals who have the necessary skills, knowledge, and experience to perform a particular job effectively.

Aggregate Plan

A planning methodology aimed at determining overall output levels in the medium term, typically involving production, inventory, and workforce levels.

Overtime Cost

The extra expenses incurred by employers for work performed by employees beyond their regular working hours, often paid at a higher rate.