A Futures Contract Is an Agreement

question 4

Multiple Choice

A futures contract is an agreement:

• A) that obligates a corporation to issue additional securities at a specified date in the future.
• B) to exchange financial assets on a specified date in the future with the price determined on that date.
• C) to deliver goods today in exchange for an agreed upon payment to be paid on a specified date in the future.
• D) to exchange a specified quantity of goods on a specified date in the future at the current market price.
• E) to exchange goods on a specified date in the future at a price that is agreed upon today.

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Definitions:

Credited

The acknowledgment of a payment received or the addition of funds to an account.

Account

An account statement that captures all transactions associated with a specific aspect of the accounting equation.

Payment

The transfer of money from one party to another as compensation for goods or services or as repayment of a loan.

Invoice

A document issued by a seller to a buyer, detailing products or services provided, prices, and terms of payment.