A ________ is a contract that requires the holder to buy or sell a stated commodity at a specified price at a specified time in the future.

Question

Quizplus · Accepted Answer

The description matches that of a futures contract. A warrant is a security that gives the holder the right to purchase a certain amount of stock at a specific price, while an option gives the holder the right but not the obligation to buy or sell a security at a specific price within a specific time period. Convertible contracts are securities that can be converted into another type of security, such as a stock or a bond, at a predetermined price and time. Therefore, the best choice for the given description is C - future.

A ________ Is a Contract That Requires the Holder to Buy