Which of the Following Statements Is Incorrect Regarding Organized Futures

question 5

Multiple Choice

Which of the following statements is incorrect regarding organized futures exchanges?

• A)Organized exchanges establish and enforce rules for the trading of financial futures contracts.
• B)Organized exchanges serve as market makers for futures contracts by taking positions in futures.
• C)Organized exchanges clear, settle, and guarantee all transactions that occur on their exchanges.
• D)The operations of financial futures exchanges are regulated by the Commodity Futures Trading Commission (CFTC).
• E)All of the above are correct.

---

Definitions:

Production Budget

A plan detailing the quantity of each product a company aims to produce within a specific timeframe, factoring in projected sales and inventory requirements.

Finished Goods Inventory

Products that have completed the manufacturing process and are ready for sale.

Cash Budget

A financial plan that estimates cash inflows and outflows over a specific period, used for managing liquidity and ensuring a company can meet its obligations.

Budgeted Cash Receipts

An estimation of the cash a company expects to receive within a certain period, based on projected sales or revenue.