A Trader Enters into a Long Position in One Eurodollar

question 3

Multiple Choice

A trader enters into a long position in one Eurodollar futures contract. How much does the trader gain when the futures price quote increases by 6 basis points?

• A) $6
• B) $150?C. $60
• C) $60
• D) $600

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Definitions:

Invitation to Treat

An invitation for parties to make an offer, which can then be accepted or rejected, not an offer itself.

Breach of Contract

The violation of any term or condition in a contract without lawful excuse.

Letter of Acceptance

A document that officially acknowledges the acceptance of an offer or proposal, typically relating to educational admission, job offers, or contractual agreements.

Satisfactory Financing

Obtaining a loan or financial backing on terms acceptable to the party or parties involved, typically within a certain timeframe.