The Spot Price of the Market Index Is $900

question 8

Multiple Choice

The spot price of the market index is $900.A 3-month forward contract on this index is priced at $930.What is the profit or loss to a short position if the spot price of the market index rises to $920 by the expiration date?

• A) $20 gain
• B) $20 loss
• C) $10 gain
• D) $10 loss

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Definitions:

Endocrine System

A network of glands in the body that secretes hormones directly into the bloodstream to regulate various bodily functions such as growth, metabolism, and reproduction.

Osteoporosis

Osteoporosis is a condition characterized by weakened bones, increasing the risk of fractures, often due to age-related or hormonal factors.

Calcitonin

A thyroid gland secretion crucial for the regulation of calcium quantities in the blood.

Epiphyseal Plate

A growth plate located at the ends of long bones where new bone tissue is generated during growth.