The Spot Price on Cocoa Is $2,880 a Ton

question 62

Multiple Choice

The spot price on cocoa is $2,880 a ton. The futures price is $2,730 a ton. The basis is _____ and the market is a(n) _____ market.

• A) -150; carrying-charge
• B) -150; inverted
• C) 50; inverted
• D) 150; carrying-charge
• E) 150; inverted

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Definitions:

EPS

Earnings Per Share, a financial ratio that indicates the portion of a company's profit allocated to each outstanding share of common stock.

Target Capital Structure

The ideal mix of debt, equity, and other financing sources a company aims to maintain to fund its operations and growth.

Optimal Capital Structure

The most favorable mix of debt and equity financing that minimizes the company's cost of capital and maximizes its value.

EPS

Earnings Per Share, a financial metric used to indicate the profitability of a company on a per-share basis.