If You Buy a Futures Contract on the S&P 500

question 51

Multiple Choice

If you buy a futures contract on the S&P 500 Index at a price of 450 and the index rises to 500,you will ________.

• A) lose $12,500
• B) gain $12,500
• C) lose $50
• D) gain $50

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Definitions:

Return on Assets

A financial ratio indicating how profitable a company is relative to its total assets, measuring how efficiently a company uses its assets to generate earnings.

Inventory Turnover

Inventory turnover is a ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating the efficiency of inventory management.

Acid Test

A rigorous and conclusive test to prove the effectiveness or value of something.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue.