Reposted - option a was selected as answer but wrong:

1. Which of the following statements regarding futures contracts is false?

a) Both the buyer and the seller can get out of the contract at any time by selling it to a third party at the current market price.

b) Futures prices are not prices that are paid today. Rather, they are prices agreed to today, to be paid in the future.

c) Futures contracts are traded anonymously on an exchange at a publicly observed market price and are generally very illiquid.

d) Traders are required to post collateral, called margin, when buying or selling commodities using futures contracts.

Option a is false- Both the buyer and the seller can get out of the contract at any time by selling it to a third party at the current market price.

This is because futures contracts are standardized financial contract between two parties in which one party agree to buy or sell the commodity at a specific price and future date and the other party agree to make sale/purchase. physical delivery does not occur. in futures contract Traders are required to post collateral, called margin, when buying or selling commodities using futures contracts.