The 6-Month Futures Price for Oil Is $96

question 13

Multiple Choice

The 6-month futures price for oil is $96.60 per barrel (or 2.30 cents per gallon) .The 6-month futures prices for gasoline and heating oil are 2.50 cents and 2.15 cents,respectively.What is the gross margin on a simple 3-2-1 crack spread?

• A) $0.25
• B) $0.35
• C) $0.54
• D) $0.68

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Definitions:

Artificially Scarce Good

A good that has its availability limited by design or through artificial means, rather than through natural scarcity.

Cable Television

A system for delivering television programming to consumers via radio frequency signals transmitted through coaxial cables.

Efficient Level

A state of resource allocation where it is not possible to make someone better off without making someone else worse off.

Excludable

A characteristic of a good where it is possible to prevent people who have not paid for it from having access to it.