Futures Contracts Trade with Every Month as a Delivery Month

question 17

Multiple Choice

Futures contracts trade with every month as a delivery month.A company is hedging the purchase of the underlying asset on June 15.Which futures contract should it use?

• A) The June contract
• B) The July contract
• C) The May contract
• D) The August contract

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Definitions:

Balanced Chemical Equation

A symbolic representation of a chemical reaction in which the number of atoms for each element is equal on both the reactant and product sides.

Coefficients

Numerical or constant multipliers that are placed before variables in equations to denote how many units of the variable are involved.

Gaseous Reaction

A chemical reaction that involves substances in the gas phase.

Final Mixture

The end product of a process in which two or more substances are combined, yielding a uniform composition throughout.