An Investor's Margin in a Futures Contract Is Checked Each

question 98

True/False

An investor's margin in a futures contract is checked each day under a procedure known as mark-to-the-market.

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Definitions:

Discount on Bonds

The discrepancy between a bond's nominal value and its market price when the bond is issued at a price below its nominal value.

Interest Method

A technique for calculating the interest expense or income on a financial instrument over a specific period based on its carrying amount and effective interest rate.

Market Rate

The prevailing price or interest rate that goods, services, or securities can be bought or sold in a competitive marketplace.

Above Face Value

A term used when a security is traded at a price higher than its nominal or face value.