A Speculator Can Be Described as Someone Who Enters into a Futures

question 56

Multiple Choice

A speculator can be described as someone who enters into a futures contract:

• A)with the purpose of making a profit.
• B)with the purpose of minimising risk.
• C)as a seller with the purpose of minimising risk.
• D)with the purpose of buying or selling a commodity defined in the futures contract.

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Definitions:

Operate

To control the functioning of a machine, process, or system.

Decreasing-Cost Industry

An industry where input costs tend to fall as the industry as a whole expands its output.

LRAC Curve

The Long Run Average Cost curve shows the lowest possible average cost of production at different levels of output when all inputs are variable.

Entry

The act or process of entering into a market as a new supplier or producer, often facing barriers such as high startup costs or regulations.