Multiple Choice
Commodity forward contracts differ from financial forwards in the following manner:
A) The underlying asset in a commodity forward is an asset that may be used in production and that gets consumed in the process.
B) Commodity forwards are always more costly than financial forwards when the spot assets have the same prices.
C) Commodity forwards have physical delivery whereas financial forwards have cash delivery.
D) Commodity forwards do not have inconvenience yields whereas financial forwards do.
Correct Answer:

Verified
Correct Answer:
Verified
Q1: You are long a forward on the
Q3: Stock A has a spot price of
Q4: The risk-free interest rate drops but the
Q5: Stock B is trading at $1100.The risk-free
Q6: Using the spot and forward markets to
Q7: Forward pricing by replication depends on the
Q8: CAP Inc.'s stock is trading at $40.Its
Q9: If the implied repo rate is
Q10: A commodity has a spot price of
Q11: The spot price trades at the following