11. Margin must be posted by ________. A. buyers of futures contracts only B. se

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11. Margin must be posted by ________. A. buyers of futures contracts only B. sellers of futures contracts only C. both buyers and sellers of futures contracts D. speculators only 12. The daily settlement of obligations on futures positions is called _____________. A. a margin call B. marking to market C. a variation margin check D. initial margin requirement 13. Which of the following provides the profit to a short position at contract maturity? A. Original futures price - Spot price at maturity B. Spot price at maturity - Original futures price C. Zero D. Basis 14. Margin requirements for futures contracts can be met by ______________. A. cash only B. cash or highly marketable securities such as Treasury bills C. cash or any marketable securities D. cash or warehouse receipts for an equivalent quantity of the underlying commodity 15. An established value below which a trader's margin may not fall is called the ________. A. daily limit B. daily margin C. maintenance margin D. convergence limit 16. Which one of the following is a true statement? A. A margin deposit can only be met by cash B. All futures contracts require the same margin deposit C. The maintenance margin is the amount of money you post with your broker when you buy or sell a futures contract D. The maintenance margin is the value of the margin account below which the holder of a futures contract receives a margin call 17. At maturity of a future contract, the spot price and futures price must be approximately the same because of __________. A. marking to market B. the convergence property C. the open interest D. the triple witching hour 18. A futures contract __________. A. is a contract to be signed in the future by the buyer and the seller of a commodity B. is an agreement to buy or sell a specified amount of an asset at a predetermined price on the expiration date of the contract C. is an agreement to buy or sell a specified amount of an asset at whatever the spot price happens to be on the expiration date of the contract D. gives the buyer the right, but not the obligation, to buy an asset some time in the future 19. Which one of the following exploits differences between actual future prices and their theoretically correct parity values? A. Index arbitrage B. Marking to market C. Reversing trades D. Settlement transactions 20. Which one of the following refers to the daily settlement of obligations on future positions? A. Marking to market B. The convergence property C. The open interest D. The triple witching hour 21. You are currently long in a futures contract. You then instruct a broker to enter the short side of a futures contract to close your position. This is called __________. A. a cross hedge B. a reversing trade C. a speculation D. marking to market 22. A company which mines bauxite decides to short aluminum futures. This is an example of __________ to limit its risk. A. cross hedging B. long hedging C. spreading D. speculating 23. On February 25, 2008 you could have purchased a futures contract from Intrade that would pay you $1 if Barack Obama won the 2008 Democratic Party nomination. At a price of $0.81, the contract for Obama carried the highest price of any Democratic candidate at the time. This tells you _______________. A. that the market believed that Obama had 81% chance of winning B. that the market believed that Obama had the least chance of winning C. nothing about the markets' belief concerning the odds of Obama winning D. that the market believed Obama's chances of winning were about 19% 24. In the context of a futures contract, the basis is defined as ______________. A. the futures price minus the spot price B. the spot price minus the futures price C. the futures price minus the initial margin D. the profit on the futures contract 25. The _________ contract dominates trading in stock index futures. A. S&P500; B. DJIA C. Nasdaq 100 D. Russell 2000

Explanation / Answer

make it short and concise , its un clear in that context, Plzzzzzzzz

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