We Have a Futures Contract for the Purchase of 10,000

question 10

Essay

We have a futures contract for the purchase of 10,000 bushels of wheat at $3.00 per bushel. If the price of wheat were to increase to $3.50, explain what happens to the parties involved in the contract in terms of marking to market. Be sure to identify who is long and short and specifically how much is transferred.

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Definitions:

Leptin

An agent released by fat tissues tasked with maintaining energy stability by reducing the sensation of appetite.

Body Fat

The portion of the human or animal body composed of fat tissues, serving as energy storage and insulation.

Puberty

The phase of life in which a child develops into an adult, marked by physical, emotional, and hormonal changes that prepare the body for reproduction.

Ventromedial

Relating to the lower-middle region of a structure or organ, often used in neuroanatomy to describe specific brain regions involved in regulating emotions and decision-making.