At Maturity of the Forward Contract, the Following Is True

question 19

Multiple Choice

At maturity of the forward contract, the following is true of the spot price and delivery price locked-in using the forward contract:

• A) The spot price is greater than the delivery price.
• B) The spot price is less than the delivery price.
• C) The spot price is equal to the delivery price.
• D) The spot price can be greater, equal to, or less than the delivery price.

---

Definitions:

Phi

A measure of association for two binary variables, reflecting the strength and direction of their relationship.

Nominal-Level

Pertains to data classification into non-numeric categories that cannot be logically ordered or ranked.

Positive Correlation

A relationship between two variables where an increase in one variable is associated with an increase in the other variable.

Increases

A rise in magnitude, quantity, or value of something.