Which of the Following Statements Is True

question 55

Multiple Choice

Which of the following statements is true?

• A)The default risk in futures contracts is considered to be less than that of forward contracts because of daily marking to market of futures.
• B)The default risk in futures contracts is considered to be less than that of forward contracts because of margin requirements on futures that act as a security bond and because of default guarantees by the future exchange itself.
• C)The default risk in futures contracts is considered to be less than that of forward contracts because of price limits that spread out over times of extreme price fluctuations.
• D)All of the listed options are correct.

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Definitions:

Mycorrhizal

Mycorrhizal relationships are symbiotic associations between fungi and the roots of plants, enhancing nutrient and water absorption.

Fibrous

Consisting of or characterized by fibers, often referring to a type of tissue in plants or the structure of certain muscle tissues in animals.

Haustoria

Specialized structures of parasitic plants or fungi that penetrate host tissues to extract water and nutrients.