Unlike Options,the Purchase of a Futures Contract Is a Binding

question 30

True/False

Unlike options,the purchase of a futures contract is a binding obligation to purchase at a fixed price at contract maturity.

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Definitions:

Operating Cycle

The duration of time it takes for a company to buy inventory, sell it as finished goods, and collect cash from the sales.

Credit Sales

Sales made by a business where payment is delayed, allowing the customer to pay at a later date.

Selling Expenses

Costs incurred directly in the selling of products or services, including advertising, sales commissions, and retail store expenses.