A foreign-exchange contract that is an agreement between two parties to buy or sell a particular currency at a particular price at a particular date as specified in a standardized contract to all participants in the specified market is known as a(n)________.
A)spot contract
B)forward contract
C)futures contract
D)equity currency contract

Question

Quizplus · Accepted Answer

A futures contract is a standardized agreement to buy or sell a particular currency (or other assets) at a predetermined price at a specified time in the future, which is available to all participants in the market. Unlike spot or forward contracts, futures contracts are traded on exchanges and are standardized in terms of contract size and settlement procedures.

A Foreign-Exchange Contract That Is an Agreement Between Two Parties