Both Forward Contracts and Futures Contracts Provide for the Receipt $\begin{array}{cc} \text { Subject to } & \text { Subject to } \\ \text { margin call } & \text { discounting } \\\end{array}$

question 52

Short Answer

Both forward contracts and futures contracts provide for the receipt or payment of a specific amount of an asset at a specific price with delivery at a specified future point in time.Which combination of characteristics is true for a futures contract? ?
$\begin{array}{cc} \text { Subject to } & \text { Subject to } \\ \text { margin call } & \text { discounting } \\\end{array}$
A) $\begin{array}{ll}&\text { No } &&&& \text { No } \\\end{array}$
B) $\begin{array}{ll}&\text { No } &&&& \text { Yes } \\\end{array}$
C) $\begin{array}{ll}&\text { Yes } &&&& \text { No } \\\end{array}$
D) $\begin{array}{ll}&\text {Yes } &&&& \text { Yes }\end{array}$

• A)\(\begin{array}{ll}
• &\text { No } &&&& \text { No } \\\end{array}\)
• B)\(\begin{array}{ll}&\text { No } &&&& \text { Yes } \\\end{array}\)
• C)\(\begin{array}{ll}&\text { Yes } &&&& \text { No } \\\end{array}\)
• D)\(\begin{array}{ll}&\text {Yes } &&&& \text { Yes }
• \end{array}\)

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Definitions:

Divergent Thinking

A thought process or method used to generate creative ideas by exploring many possible solutions.

True Creativity

The ability to generate ideas or products that are both novel and valuable, reflecting genuine innovation.

Terman

Refers to Lewis Terman, an American psychologist best known for his revisions of the Stanford-Binet Intelligence Scales and research on gifted children.

Academic Genius

This term describes an individual with exceptional intellectual ability or academic achievement, often manifesting in breakthrough insights or outstanding scholarly work.