The main difference between a forward contract and a cash transaction is:
A) only the cash transaction creates an obligation to perform.
B) a forward is performed at a later date while the cash transaction is performed immediately.
C) only one involves a deliverable instrument.
D) neither allows for hedging.
Correct Answer:
Verified
Q1: Derivatives can be used to either hedge
Q2: A futures contract on gold states that
Q5: The buyer of a forward contract:
A) will
Q6: Two key features of futures contracts that
Q7: If rates in the market fall between
Q8: You have taken a short position in
Q9: Suppose you agree to purchase one-ounce of
Q10: You have taken a short position in
Q11: In the practical use of credit default
Q57: Suppose you agree to purchase one ounce
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