A(n) ________ Is a Contract That Requires the Holder to Buy

question 18

Multiple Choice

A(n) ________ is a contract that requires the holder to buy or sell a stated commodity at a specified price at a specified time in the future.

• A) warrant
• B) option
• C) futures
• D) convertible contract

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Definitions:

APC

The Average Propensity to Consume indicates the share of income used for consumption purposes.

Disposable Income

Economic reserves left for households after income tax deductions, meant for spending and saving.

Consumption

The process by which goods and services are used by households, contributing to the overall demand in an economy.

Induced Consumption

Induced consumption is the portion of consumer spending that varies with income levels, suggesting that as people earn more, they tend to spend more.