A Futures Contract

question 17

Multiple Choice

A futures contract

• A)is tailor-made to fit the needs of the buyer and the seller.
• B)has more credit risk than a forward contract.
• C)is marked to market more frequently than a forward contract.
• D)has a shorter time to delivery than a forward contract.
• E)has more price risk than a forward contract.

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Definitions:

Fraud

A deliberate deception practiced to secure unfair or unlawful gain, typically involving financial or personal gain.

Product Liability

The legal responsibility of manufacturers and sellers to compensate for injury or damage caused by defective products.

Risk-Utility Analysis

A process used to evaluate the safety of a product by weighing the risks associated with its use against its utility or benefits.

Fire-Retardant Materials

Materials that are designed or treated to resist fire and reduce its spread, commonly used in construction and manufacturing to enhance safety.