Multiple Choice
A futures contract on gold states that buyers and sellers agree to make or take delivery of an ounce of gold for $400 per ounce. The contract expires in 3 months. The current price of gold is $350 per ounce. If the price of gold rises and continues to rise by $1 every day over the 3 month period, then when the contract is settled, the buyer will _____ and the seller will ____.
A) lose; gain
B) gain; lose
C) gain; break even
D) gain; gain
E) lose; lose
Correct Answer:
Verified
Correct Answer:
Verified
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