A forward contract is an agreement between two parties for a sale:
A) Of goods delivered today and the price determined in the future.
B) Of an unspecified quantity in the future at a price set today.
C) At some future date with both the quantity and the price determined on that future date.
D) At some future date with the quantity determined today and the price determined in the future.
E) At some future date with both the quantity and price determined today.

Question

Quizplus · Accepted Answer

A forward contract is a customized contract between two parties to buy or sell an asset at a specified price on a future date. Both the quantity and the price are determined at the time the contract is entered into, not in the future.

A Forward Contract Is an Agreement Between Two Parties for a Sale