Why Are Most Futures Contracts Not Settled Through Delivery of the Product

question 69

Multiple Choice

Why are most futures contracts not settled through delivery of the product?

• A) Most contracts are settled through the margin account.
• B) Most contracts expire with neither party having an obligation to the other party.
• C) Most participants cancel their futures contracts through purchase of an option contract.
• D)It is easier and cheaper to settle in cash or by offset.

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Definitions:

Control Attention

The ability to maintain focus on relevant stimuli and manage one's attention in the face of distractions.

Immersion Approach

A teaching method primarily used in language education where students are placed in an environment where they must use the new language to learn it.

Dual Language Learning

The process by which individuals learn two languages simultaneously, often from an early age.

Bilingualism

The ability of an individual to use two languages effectively, often developed through exposure and practice from a young age.