How Can We Get Out of a Futures Contract

question 33

Multiple Choice

How can we get out of a futures contract?

• A)Take an equal and opposite position in another contract.
• B)Just let the contract expire.
• C)Sell the contract.
• D)Both a and c.

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Definitions:

Price Ceiling

A government-imposed limit on how high a price can be charged on a product or service, intended to protect consumers.

Market Price

The current price at which an asset or service can be bought or sold in a particular market.

Market Equilibrium

A situation where the quantity demanded of a good or service equals the quantity supplied, leading to a stable price.

Actual Price

The price at which a good or service is sold in the market, not taking into account discounts or premiums.