Logan sold a corn futures contract using the initial margin of $2,700. His maintenance margin is $2,000. The price of began to rise in early summer, but Logan wants to keep his contract
When his margin falls below $2,000 (minimum maintenance)
A) his contract will be automatically sold or canceled.
B) he does not need to do anything since the most he can lose is $2,700.
C) he will need to deposit at least $700 with his broker to bring his margin back up to the initial deposit.
D) he will need to deliver the corn immediately.
Answer: C
You might also like to view...
When using a perpetual inventory system,
a. no Purchases account is used. b. a Cost of Goods Sold account is used. c. two entries are required to record a sale. d. all of these.
If a marketing manager segments the market into culture-oriented, sports-oriented, or outdoor-oriented groups, he or she is segmenting on the basis of ________
A) loyalty status B) behavioral occasions C) user status D) psychographic lifestyle E) readiness stage