Which of the Following Is NOT a Difference Between a Currency

question 37

Multiple Choice

Which of the following is NOT a difference between a currency futures contract and a forward contract?

• A) The futures contract is marked to market daily, whereas the forward contract is only due to be settled at maturity.
• B) The counterparty to the futures participant is unknown with the clearinghouse stepping into each transaction, whereas the forward contract participants are in direct contact setting the forward specifications.
• C) A single sales commission covers both the purchase and sale of a futures contract, whereas there is no specific sales commission with a forward contract because banks earn a profit through the bid-ask spread.
• D) All of the above are true.

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Definitions:

Arithmetically

Relating to or based on arithmetic, the branch of mathematics dealing with the properties and manipulation of numbers.

Thomas Malthus

An English economist and demographer known for his theory that population growth will always tend to outrun the food supply.

Food Supplies

The availability and distribution of edible goods and commodities to meet the consumption needs of the population.

Evolutionary Mechanism

A process by which variations in the genetic material of organisms lead to differences in traits that can affect an organism's survival and reproduction.