Which of the Following Is the Major Difference Between Forward

question 6

Multiple Choice

Which of the following is the major difference between forward and futures contracts?

• A) Futures contracts are more expensive than forward contracts.
• B) Forward contracts are available only for foreign currencies.
• C) Futures contracts are always delivered.
• D) Forward contracts are not marked to market.

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Definitions:

Accounting Period

A specific time period for which financial information is reported, commonly a year or a quarter.

Calendar Year

A period of time that starts on January 1 and ends on December 31, used for accounting and official purposes.

Debit Part

The left side of an accounting entry, which increases assets and expenses and decreases liabilities and equity.

Journal Entry

A recording of a business transaction in an accounting journal, indicating the financial effects of the transaction.