The Use of Leverage Is Practiced in the Futures Markets

question 56

Multiple Choice

The use of leverage is practiced in the futures markets due to the existence of ________.

• A) banks
• B) brokers
• C) clearinghouses
• D) margin

---

Definitions:

Monopolistically Competitive Industry

An industry characterized by many firms selling products that are similar but not identical, allowing for competition based on product differentiation.

Monopolistic Competition

A market structure in which many firms sell products that are similar but not identical, allowing for some degree of market power.

Pure Competition

A market structure characterized by a large number of sellers offering identical products with no single entity controlling the market price.

Oligopoly

A market structure dominated by a small number of large firms, leading to competitive and cooperative behavior among companies.