If You Took a Long Position in a Pork Bellies

question 73

Multiple Choice

If you took a long position in a pork bellies futures contract and then forgot about it, what would happen at the expiration of the contract?

• A) Nothing-the seller understands that these things happen.
• B) You would wake up to find the pork bellies on your front lawn.
• C) Your broker would send you a nasty letter.
• D) You would be notified that you owe the holder of the short position a certain amount of cash.
• E) You would be notified that you have to pay a penalty in addition to the regular cost of the pork bellies.

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Definitions:

Account Balances

The total amounts in financial accounts, reflecting the sum of all transactions like deposits and withdrawals, at any given time.

Exchange Rates

The valuation of one currency in terms of its equivalent in another currency.

U.S. Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, within the United States.

Accumulated Depreciation

The total amount of a tangible asset's cost that has been allocated as depreciation expense since the asset was put into use.