Two Key Features of Futures Contracts That Make Them More

question 62

Multiple Choice

Two key features of futures contracts that make them more in demand than forward contracts are:

• A)futures are traded on exchanges and must be marked to the market.
• B)futures contracts allow flexibility in delivery dates and provide a liquid market for netting positions.
• C)futures are marked to the market and allow delivery flexibility.
• D)futures are traded in liquid markets and are marked to the market.
• E)All of the above.

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Definitions:

Sample Information

Data collected from a subset of a larger population, used to make inferences about the population.

T-Distribution

A type of probability distribution that is symmetric and bell-shaped, but with heavier tails than a normal distribution, used especially in statistics for small sample sizes.

Normally Distributed

Refers to a type of probability distribution that is evenly balanced around the mean, indicating that values close to the mean occur more often than values further from the mean.

Population

The entire group of individuals or instances about whom the data is collected and which the statistical analysis is based upon.