In the Event of a Default on One Side of a Futures

question 4

Multiple Choice

In the event of a default on one side of a futures trade,

• A)the clearing member stands in for the defaulting party.
• B)the clearing member will seek restitution for the defaulting party.
• C)if the default is on the short side, a randomly selected long contract will not get paid. That party will then have standing to initiate a civil suit against the defaulting short.
• D)both a and b

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Definitions:

Flagellated Collar Cells

Specialized cells found in sponges that have a flagellum surrounded by a collar used to pump water through the sponge and trap food particles.

True Coelom

A fluid-filled body cavity completely lined by tissue derived from the mesoderm, found in most complex animals, which provides a space for organ development and movement.

Sponges

Simple aquatic animals that draw water containing food particles into their porous bodies by means of flagellated cells.

Hydras

A type of small, freshwater organisms from the phylum Cnidaria, known for their regenerative abilities.