A future is a standardized contract to buy or sell specified quantities of a commodity or ________ at a specified ________.
A) financial instrument; price
B) financial instrument; level of risk
C) unspecified quantities; price
D) unspecified quantities; level of risk

Question

Quizplus · Accepted Answer

A future is a standardized contract to buy or sell a specified quantity of a commodity or financial instrument at a specified price. Therefore, option A is the correct choice as it mentions the correct definition of a future contract. Option B and D mention 'level of risk' which is not a specified term used in futures trading. Option C mentions 'unspecified quantities' which is not correct as futures contracts always have a specified quantity.

A Future Is a Standardized Contract to Buy or Sell