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:

Cross Dock Distribution Center

A warehouse where incoming shipments are directly transferred to outgoing trucks or trailers, minimizing storage time and accelerating distribution.

Milk Runs

A delivery method where a single vehicle collects and delivers goods in a route that minimizes transportation time and cost, often used for JIT inventories.

LTL Carrier

An LTL (Less Than Truckload) Carrier is a transportation service that combines shipments from multiple customers into one truckload, optimizing efficiency for smaller loads.

Package Carrier

A company or service that specializes in the transportation and delivery of parcels and packages, operating within postal, commercial, or freight contexts.