Which of the Following Statements Is True for a 10-Year

question 44

Multiple Choice

Which of the following statements is true for a 10-year bond future contract?

• A)Trading ceases on the 15th day of the settlement month.
• B)Trading ceases on the last business day of the contract month.
• C)Settlement day is the third business day after the day when trading ceases.
• D)Settlement day is the second business day after the day when trading ceases.

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Definitions:

Dividend Income

Earnings obtained by holding company shares, typically dispensed from the firm's earnings.

Optimal Dividend Policy

The best strategy a company can adopt for the payment of dividends, balancing between retaining earnings for growth and satisfying shareholders.

Residual

The amount remaining after the greater part has been deduced; in finance, often refers to the residual value or remaining interest in an asset.

Stock Splits

occur when a company divides its existing stock into multiple shares to boost the liquidity of the shares, though the overall value of the company doesn't change.