Through the Processes of Novation and Margin Payments, the Clearinghouse

question 76

Multiple Choice

Through the processes of novation and margin payments, the clearinghouse:

• A)becomes counterparty to each futures transaction
• B)seeks to protect traders from default risk
• C)will close out the position of defaulting traders
• D)guarantees the performance of futures contracts.
• E)All of these are correct.

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Definitions:

Distribution Strategies

Plans developed by organizations to ensure the delivery of their products or services to the end user.

Pricing Strategies

Methods businesses use to set the selling price of their products or services.

Multiple Channel Approach

A marketing strategy that uses several distinct channels to reach and serve customers, such as physical stores, online platforms, and mobile applications.

Product Distribution

The process of making a product available for purchase by dispersing it through the market.