Forward and Future Contracts, as Well as Options, Are Types

question 47

True/False

Forward and future contracts, as well as options, are types of derivative securities.

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Definitions:

Auction Without Reserve

A type of auction in which the item for sale will be sold regardless of the price since there is no minimum bidding threshold set.

Diamond Ring

A piece of jewelry featuring a diamond set into a ring, often used as a symbol of commitment or status.

Bilateral Contract

A mutual agreement between two parties where each promises to perform an act in exchange for the other's act.

Unilateral Contract

An agreement in which only one party makes a legally enforceable promise to pay or provide other benefits if the other party performs a specific task.