What Must Happen to Prices Over the Course of a Contract

question 1

Multiple Choice

What must happen to prices over the course of a contract for the seller of a futures contract to maximize benefits of the hedge?

• A) Prices must decrease.
• B) Prices must increase.
• C) Prices must remain constant.
• D) The seller will profit on the hedge regardless of the direction of price movements.

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Definitions:

Suprarenal Vein

A vein draining blood from the adrenal gland into the renal vein or inferior vena cava.

Internal Jugular Vein

A major vein that collects blood from the brain, face, and neck, and returns it to the heart.

Hepatic Vein

A vein that drains de-oxygenated blood from the liver into the inferior vena cava.

Axillary Vein

A vein that conveys blood from the lateral aspect of the thorax, armpit, and upper limb toward the heart.