Which of the following is true of parties to a forward contract?

A) buyers take a short position, sellers take a long position
B) buyers take a long position, sellers take a long position
C) buyers take a short position, sellers take a short position
D) buyers take a long position, sellers take a short position

Question

Which of the following is true of parties to a forward contract?

A) buyers take a short position, sellers take a long position
B) buyers take a long position, sellers take a long position
C) buyers take a short position, sellers take a short position
D) buyers take a long position, sellers take a short position

Quizplus · Accepted Answer

A forward contract is an agreement between two parties to trade a specified asset at a future date at a price agreed upon today.The agreed price is known as the forward price.The buyer of a forward contract assumes a long position while the seller assumes a short position.

Which of the Following Is True of Parties to a Forward