Margin Requirements for Futures Contracts Can Be Met by ________

question 41

Multiple Choice

Margin requirements for futures contracts can be met by ________.

• A)cash only
• B)cash or highly marketable securities such as Treasury bonds
• C)cash or any marketable securities
• D)cash or warehouse receipts for an equivalent quantity of the underlying commodity

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Definitions:

Buyer Bears

This concept refers to the condition in which the purchaser is responsible for any additional expenses that arise after a purchase agreement, such as repair or maintenance costs.

Price Wedge

The difference between the price paid by buyers and the price received by sellers, often resulting from taxes, subsidies, or other interventions in the market.

FICA

Stands for Federal Insurance Contributions Act, specific U.S. legislation that funds Social Security and Medicare through payroll taxes.

Seller Bears

Refers to situations where the seller is responsible for any additional costs or risks associated with a transaction.