You Enter into a Forward Contract to Take Delivery of 1

question 86

Multiple Choice

You enter into a forward contract to take delivery of 1 million euros 3 months from now.What happens to the price you will pay at expiration if the euro depreciates during the contract period?

• A) Your price will increase.
• B) Your price will decrease.
• C) Your price was fixed at the onset of the contract.
• D) Your price was fixed but you will receive correspondingly more euros due to the depreciation.

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Definitions:

Securely Attached

A term used in psychology to describe individuals who have healthy, trust-based relationships, often stemming from nurturing caregiving in early life.

Basic Dimensions

Fundamental aspects or quantities that define the structure, form, or operation of an entity or system.

Temperament

A person’s characteristic level of reactivity and energy; often thought to be constitutional.

Social Interactions

Exchanges between two or more individuals, influencing their behavior and relationships within a society.