Question 5 Futures A gasoline distributor buys a gasoline futures contract that requires acceptance of 42,000 gallons of gasoline at £0.94 per gallon. How is the account marked to market if gasoline futures close the next day at £0.97? A. A loss of £1,260 is posted to the account. B. A gain of £1,260 is posted to the account. C. A loss of £12,600 is posted to the account. D. A gain of £12,600 is posted to the account.
Question 5 Futures A gasoline distributor buys a gasoline futures contract that requires acceptance of 42,000 gallons of gasoline at £0.94 per gallon. How is the account marked to market if gasoline futures close the next day at £0.97? A. A loss of £1,260 is posted to the account. B. A gain of £1,260 is posted to the account. C. A loss of £12,600 is posted to the account. D. A gain of £12,600 is posted to the account.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Question 5 Futures
A gasoline distributor buys a gasoline futures contract that requires acceptance of 42,000 gallons of gasoline at £0.94 per gallon. How is the account marked to market if gasoline futures close the next day at £0.97?
A. A loss of £1,260 is posted to the account.
B. A gain of £1,260 is posted to the account.
C. A loss of £12,600 is posted to the account.
D. A gain of £12,600 is posted to the account.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education