Which of the Following Statements Is True Regarding Forward Contracts,futures

question 12

Multiple Choice

Which of the following statements is true regarding forward contracts,futures contracts,options and swaps?

• A)A forward contract can be purchased on the open market and is recorded at its historical cost,then adjusted for changes in the market.
• B)A futures contract is negotiated between two parties who are betting in the opposite direction on the movement of the underlying price.
• C)An option is a contract requiring the holder to either "put" or "call" an underlying asset at a specified point in time.
• D)A swap is a contract between two parties to exchange an ongoing stream of cash flows.

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Definitions:

Olfactory Epithelium

The lining of the roof of the nasal cavity, containing a sheet of receptor cells for smell.

Papillae

Rounded bumps above the tongue’s surface that contain the taste buds, the receptors for taste.

Pinnae

The visible part of the ear that protrudes from each side of the head, playing a role in collecting sound vibrations and directing them into the ear canal.

Inner Ear

A complex structure deep within the ear responsible for hearing and balance, containing the cochlea and vestibular system.