Tony Harris is planning to start trading in commodities. He has heard about the use of futures

Question:

Tony Harris is planning to start trading in commodities. He has heard about the use of futures contracts on commodities and is learning more about them. Which of the following is Harris least likely to find associated with a futures contract?

A. Existence of counterparty risk.

B. Standardized contractual terms.

C. Payment of an initial margin to enter into a contract.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For answer-question

Investments Principles Of Portfolio And Equity Analysis

ISBN: 9780470915806

1st Edition

Authors: Michael McMillan, Jerald E. Pinto, Wendy L. Pirie, Gerhard Van De Venter, Lawrence E. Kochard

See More Books

Question Posted: Mar 21, 2024 07:00 AM

See More Questions

KYC's stock price can go up by 15 percent every year, or down by 10 percent. Both outcomes are equally likely. The risk free rate is 5 percent, and the current stock price of KYC is 100. (a) Price a...
Every 4 years the world gathers to participate in and spectate the Olympic Games. The planning and execution required for the games is at the highest level. There is little to no room for error, due...
"internet radios" for streaming audio, and personal video recorders and players. Describe design and evaluation processes that could be used by a start-up company to improve the usability of such...
Increasingly sophisticated communications technology is allowing more people to work at home. What effect do you think this might have on land-use patterns, specifically the density of residential...
The most recent financial statements for Williamson Inc., are shown here (assuming no income taxes): Assets and costs are proportional to sales. Debt and equity are not. No dividends are paid. Next...
Audit Risk. Your firm recently signed a letter of engagement to audit CitCo, the local city and county government. Over your morning cup of coffee, you open the local newspaper and read the...
In the organizational chart for the consumer-packaged goods firm in Figure 22 5, where do product line, functional, and geographical groupings occur? Figure 22-5 Chief Marketing Officer or Vice...
Bar Company has a maximum capacity of 500,000 units per year. Variable manufacturing costs are $25 per unit. Fixed overhead is $900,000 per year. Variable selling and administrative costs are $5 per...
It is now June 30, 2023. The journal entry for the investment in the put option had already been recorded on January 1, 2023. SmartiePants Corp prepared its financial statements on March 31, 2023 as...
A German company that exports machinery is expecting to receive $$10$ million in three months. The firm converts all its foreign currency receipts into euros. The chief financial officer of the...
The usefulness of a forward contract is limited by some problems. Which of the following is most likely one of those problems? A. Once you have entered into a forward contract, it is difficult to...
a. What are the equilibrium rent and equilibrium quantity of rental housing? b. If a rent ceiling is set at $600 a month, what is the quantity of housing rented and what is the shortage of housing?...
Suppose you want your daughter's college fund to contain $100,000 after 17 years. If you can get an APR of 8.6%, compounded monthly, how much should you deposit at the end of each month? At age 20...
Let Y have a uniform distribution U(0, 1), and let W=a+(b-a)Y, (a) Find the cdf of W. - a
She budgeted $420,000 in software costs for the entire company, however in my prior conversations with her she had told me she thought they might be around $630,000 this year. What might have...
Michael is 47 years old and lives in toronto, Ontario with his wife emma. They have one daughter. Michael was forced into early retirement due to a workplace accident. Emma is a homemaker and she has...
(a) Show the initial temperature distribution in a diagram. (b) What is the final temperature distribution after a very long time has elapsed? (c) Sketch curves that you think would represent the...
Outline a general process applicable to most control situations. Using this, explain how you would develop a system to control home delivery staff at a local pizza shop.
White Corporation, a calendar year C corporation, manufactures plumbing fixtures. For the current year, White has taxable income [before the domestic production activities deduction (DPAD)] of...
During the current year, Swallow Corporation, a calendar year C corporation, has the following transactions: Income from operations $660,000 Expenses from operations 720,000 Dividends received from...
Red Corporation and White Corporation, both calendar year C corporations, are members of a controlled group of corporations. For the current year, Red has taxable income of $130,000, and White has...
Potter Janitorial Services provides cleaning services to both homes and offices. In the past year, income before taxes was $4,250, as follows: Home Office Total Revenue $250,000 $425,000 $675,000...
19. Peters & Co manufactures casings for toy drones. The standard cost of this product is as follows: Material X 8kg At $4/kg 32.00 Material Y 4kg At $7/kg 28.00 Labour 3 hours At $17/hour 51.00...
Using the following product information, calculate the direct materials price variance and the direct materials quantity variance. Indicate whether each variance is favorable or unfavorable. Actual...

Tony Harris is planning to start trading in commodities. He has heard about the use of futures

Question:

Step by Step Answer:

A is correct Harris is least likely to find ...View the full answer

Investments Principles Of Portfolio And Equity Analysis

Students also viewed these Business questions