Futures Contracts Are Similar to Forward Contracts in That They

question 26

Multiple Choice

Futures contracts are similar to forward contracts in that they both

• A) Have volatile price movements and strong interest from buyers and sellers.
• B) Give the holder the option to make a transaction in the future.
• C) Have similar liquidity.
• D) Have similar credit risk.
• E) None of the above.

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Definitions:

Optimistic

Having a positive or hopeful attitude towards the future, often with a confidence in successful outcomes.

Adverse Effects

Unintended, negative outcomes resulting from a medical treatment, medication, or intervention.

Stress

A biological and psychological response experienced on encountering a threat that we feel we do not have the resources to deal with.

Religious Involvement

The extent of an individual's participation in activities and rituals of a religious community, reflecting beliefs, practices, and a sense of belonging to a faith group.