If You Took a Short Position in Two S&P 500

question 23

Multiple Choice

If you took a short position in two S&P 500 futures contracts at a price of 1,510 and closed the position when the index futures was 1,492, you incurred

• A)a gain of $9,000.
• B)a loss of $9,000.
• C)a loss of $18,000.
• D)a gain of $18,000.
• E)None of the options

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Definitions:

Cash Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits.

Indirect Method

A cash flow statement presentation technique where net income is adjusted for changes in balance sheet accounts to calculate operating cash flow.

Indirect Method

A technique used in cash flow statement preparation where net income is adjusted for non-cash transactions to calculate operating cash flows.

Cash Dividends

Payments made by a corporation to its shareholder members from earnings, typically in the form of cash.