Which of the Following Is Incorrect Regarding Organized Exchanges Trading

question 25

Multiple Choice

Which of the following is incorrect regarding organized exchanges trading financial futures contracts?

• A) Organized exchanges establish and enforce rules for the trading of financial futures contracts.
• B) Organized exchanges ensure that the seller of the futures contract always delivers the securities covered by the contract, whether the contract was settled prior to the settlement date or not.
• 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.

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Definitions:

Mutually Exclusive

Refers to a situation where the occurrence of one event means the other cannot occur.

Independent

A term in statistics that describes two or more events that do not affect each other's outcomes.

Multiplicative Rule

In probability, a rule that calculates the probability of two independent events occurring together by multiplying the probability of each event.

Probability

A gauge of an event's occurrence likelihood, numerically between 0 and 1.