You Purchased Two Futures Contracts on Soybeans at a Price

question 97

Multiple Choice

You purchased two futures contracts on soybeans at a price quote of 1344'0. The initial margin requirement is $4,750 per contract and the maintenance margin is $3,500 per contract. The contract quantity is 5,000 bushels and the price quote is in cents per bushel. What is the lowest the price quote can go before you receive a margin call?

• A) 1314'0
• B) 1315'0
• C) 1319'0
• D) 1322'0
• E) 1325'0

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Definitions:

Benthic

Related to the bottom of a sea or lake or to the organisms that live on or in the bottom sediments.

Pelagic

Referring to oceanic water not close to the bottom or shore, encompassing the entire water column used particularly in context to the life and ecosystems found within this vast, open ocean area.

Biodiversity

The variety and variability of life forms within a given ecosystem, region, or the entire Earth, crucial for maintaining ecological balance.

Trawl Fishing

A method of fishing that involves dragging a large net through the water, either at midwater or along the sea bottom.