All of the following are roles of a exchange EXCEPT
A)instituting margin requirements on futures contracts.
B)marking to market at the end of each day.
C)eliminate the need for buyers and sellers of futures contracts to be concerned about the creditworthiness of each other.
D)reducing the default risk involving forward contracts.

Question

Quizplus · Accepted Answer

Exchanges do not reduce the default risk involving forward contracts, as forward contracts are typically private agreements between parties and not traded on exchanges.

All of the Following Are Roles of a Exchange EXCEPT