There Is a Futures Contract for the Purchase of 1000

question 78

Multiple Choice

There is a futures contract for the purchase of 1000 bushels of corn at $3.00 per bushel.If the market price of corn falls to $2.50:

• A)The buyer (long position) needs to transfer $500 to the seller (short position).
• B)The seller (long position) needs to transfer $500 to the buyer (short position).
• C)Nothing happens since marked to market adjustments only occur if the market price rises above the contract price.
• D)Nothing happened since no funds are transferred until the settlement date.

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Definitions:

Horizontal décalage

A concept in Piaget's theory referring to the observation that children can acquire similar cognitive skills at different times across different domains.

Multitasking

Cognitive processes involving attending and responding to multiple sources of information simultaneously.

Secular trend

A long-term pattern or trend that can be observed over several generations or periods.

Evaluativist theory

A perspective in psychology focusing on how individuals assess, judge, or make decisions based on information and moral principles.