The Dollar Value of the Outstanding Futures Position Depends on The

question 49

Multiple Choice

The dollar value of the outstanding futures position depends on the:

• A)number of contracts bought and sold and the price of each contract
• B)cash exposure ratio
• C)number of contracts bought and sold and the change in interest rates
• D)contracts that should be sold per dollar of cash exposure

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Definitions:

Earnings Before Taxes

A company's profitability measure calculated by subtracting all expenses, except taxes, from revenues.

Earnings Per Share

A company's profit divided by its number of outstanding shares of common stock.

Convertible Bond

A type of bond that allows bondholders the option to convert their debt into a predetermined number of shares of the issuing company.

Call Price

The price at which a bond or other financial security can be repurchased by the issuer before its maturity date, often higher than the face value to compensate investors.