On the day of delivery
A) the spot price will equal the futures price.
B) the spot price will be greater than the futures price by an amount equal to the current interest rate times the futures price.
C) the futures price will be greater than the spot price by an amount equal to the current interest rate times the spot price.
D) there is no necessary relation between the spot price and the futures price.
Correct Answer:
Verified
Q18: Forward transactions
A)provide substantial liquidity.
B)entail small information costs.
C)provide
Q19: If a wheat crop turns out to
Q20: Forward transactions would be useful to
A)a government
Q21: The seller of a futures contract
A)assumes the
Q22: The futures price
A)reflects traders' expectations of the
Q24: If you sell a futures contract for
Q25: All of the following are roles of
Q26: Financial futures contracts are regulated by
A)the Commodity
Q27: Marking to market involves
A)changing the futures price
Q28: The buyer of a futures contract
A)assumes the
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