A Soybean Oil Contract Calls for Delivery of 60,000 Pounds

question 116

Multiple Choice

A soybean oil contract calls for delivery of 60,000 pounds.What happens to the seller of a soybean futures contract at 16 cents per pound if the futures price closes the next day at 18 cents per pound?

• A)The contract is marked to market with a $1,200 loss.
• B)The contract is marked to market with a $1,200 gain.
• C)Futures contracts are voided if price increases before expiration.
• D)Nothing happens until the expiration of the contract.

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Definitions:

Prejudice

A preconceived opinion that is not based on reason or actual experience, often leading to unjust discrimination.

Women

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