The Forward Contract Differs from a Futures Contract in That

question 114

Multiple Choice

The forward contract differs from a futures contract in that:

• A) the forward contract is to be settled immediately.
• B) the futures contract specifies a fixed amount and arranged date, whereas the forward contract can be for any amount or date.
• C) the futures contract cannot be traded in a market, whereas the forward contract can be bought in the market.
• D) forward contracts are standardized, whereas futures contracts are not standardized.

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Definitions:

Quality Cost Report

A document or tool that tracks the costs associated with ensuring the quality of products or services, including prevention, appraisal, and failure costs.

Warranty Repairs

Services offered by manufacturers or retailers to repair, replace, or rectify defects in products within a specified period after purchase, at no cost to the customer.

Internal Failure Cost

Costs associated with defects found before the product is delivered to the customer, including scrap and rework.

Quality Cost Report

A document that outlines the costs associated with preventing, detecting, and correcting defective work, categorized into prevention costs, appraisal costs, and failure costs.