Which Type of Contract Is Unique in That It Protects

question 58

Multiple Choice

Which type of contract is unique in that it protects the owner against unfavorable movements in the prices or rates while allowing the owner to benefit from favorable movements?

• A) Interest rate swap
• B) Forward contract
• C) Option
• D) Futures contract

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Definitions:

Delivery Performance

A measurement of how well a company can meet its promised delivery times to customers.

Delivery Cycle Time

The total time taken from receipt of a customer order to the delivery of the product or service.

Fill Orders

The process of preparing and delivering products or services as per customer requests or purchase orders.

Manufacturing Cycle Efficiency

A performance metric that measures the proportion of value-added time to the total lead time within the manufacturing process.