The Buyer of a Forward Contract

question 36

Multiple Choice

The buyer of a forward contract:

• A)will be taking delivery of the good(s) today at today's price.
• B)will be making delivery of the good(s) at a later date at that date's price.
• C)will be making delivery of the good(s) today at today's price.
• D)will be taking delivery of the good(s) at a later date at pre-specified price.
• E)Both A or D.

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Definitions:

Nikkei Stock Index

A stock market index for the Tokyo Stock Exchange, representing the performance of leading companies in Japan.

FTSE

The Financial Times Stock Exchange Group, a company that specializes in index calculation. Often referenced with its indices such as the FTSE 100.

EAFE

An acronym for Europe, Australasia, and Far East, representing a stock index that measures the equity market performance outside the U.S. and Canada.

European, Australian, Far East

An acronym (EAFE) referring to a major stock market index that measures the equity market performance of developed markets outside of North America.