You Sold One Wheat Future Contract at $3

question 48

Multiple Choice

You sold one wheat future contract at $3.04 per bushel. What would be your profit (loss) at maturity if the wheat spot price at that time were $2.98 per bushel? Assume the contract size is 5,000 bushels and there are no transactions costs.

• A) $30 profit
• B) $300 profit
• C) $300 loss
• D) $30 loss

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Definitions:

Margin of Error

An expression of the extent to which a sample statistic may differ from the true population parameter; it quantifies uncertainty in estimation.

Z Value

A measure in statistics that represents the number of standard deviations a data point is from the mean.

Confidence Interval

A range of values used in statistics that estimates where a true parameter value for a given population lies with a certain level of confidence.

Sample Standard Deviation

A measure of the dispersion or variation in a set of sample data, representing how much individual data points differ from the sample mean.