If Someone Enters into a Contract with the Intention of Taking

question 38

Multiple Choice

If someone enters into a contract with the intention of taking delivery of a commodity set out in the contract for a price that was determined before delivery,they are likely to be:

• A)a broker.
• B)a speculator.
• C)a hedger.
• D)a speculator or hedger.

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Definitions:

Net Operating Income

Represents the amount of profit realized from a business's operations after subtracting all operating expenses from operating revenues.

Common Stock

A type of equity security that represents ownership in a corporation, with voting rights and potential dividends.

Return on Equity

A financial ratio that measures the profitability of a firm in relation to its equity, indicating how well a company uses investments to generate earnings growth.

Stockholders' Equity

The residual interest in the assets of a corporation that remains after deducting its liabilities, often referred to as shareholder's equity or owners' equity.