A Gold Mining Firm Sells Futures Contracts Worth 1000 Ounces

question 88

Multiple Choice

A gold mining firm sells futures contracts worth 1000 ounces at a price of $700 per ounce for maturity one year from today.If gold futures prices increase to $702 per ounce,what is the cash flow to the producer?

• A)-$2000
• B)$2000
• C)$0
• D)$700,000
• E)$702,000

Understand the concept of equity and debt financing in a business context.

Apply concepts of percentage change to demographic and economic indicators.

Understand and apply concepts of speed and efficiency in work-related contexts.

Understand how to calculate the percentage by which revenue exceeds operating expenses given the percentage of operating expenses to revenue.

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Definitions:

Level Of Significance

In statistical hypothesis testing, it is the threshold below which the p-value must fall for the results to be considered statistically significant.

Flavour Distribution

A concept not standardly recognized in statistical or scientific terminology, likely referring to the spread or variation of flavors within a sample or population. NO.

Candy Company

A candy company is a business that specializes in the production and sale of confections such as chocolates, gummies, and other sweets.

Level Of Significance

A threshold within a statistical test that defines the probability of incorrectly rejecting the null hypothesis, often denoted by alpha.