Question

In: Finance

Why might a buyer or seller opt for a standardized futures contract as opposed to a...

  1. Why might a buyer or seller opt for a standardized futures contract as opposed to a customized forward contract?
  2. What is the difference between hedging and insuring? (2 pts.)

Solutions

Expert Solution

Detailed explanation is given


Related Solutions

A German seller and a U.S. buyer form a contract. The buyer breaches. The seller sues...
A German seller and a U.S. buyer form a contract. The buyer breaches. The seller sues in a German court and wins damages, but the buyer’s assets are in the United States. If a U.S. court enforces the judgment, it will be because of Question 33 options: the doctrine of sovereign immunity. the act of state doctrine. the principle of comity. None of the above.
Buyer and Seller entered into a contract governed by the CISG for Seller to deliver a...
Buyer and Seller entered into a contract governed by the CISG for Seller to deliver a sophisticated computer to Buyer by January 1. Seller was late in delivering themachine, so Buyer wired Seller on January 2: “Anxious to take delivery of the computer. Hope that it arrives by February1.”Seller delivers the computer on February 5, but Buyer refused to accept it and declares that the contract is avoided because Seller failed to hand over the computer before the February 1...
Expatiate on the duties of the seller to the buyer in a contract for sale of...
Expatiate on the duties of the seller to the buyer in a contract for sale of goods.
One distinguishing difference between the buyer of a futures contract and the buyer of an option...
One distinguishing difference between the buyer of a futures contract and the buyer of an option contract is that the futures buyer: A) Pays a much higher premium than option buyers B) Has an obligation to purchase, not a choice C) Can lose no more than initial premium D) Has increased rather than reduced risk
Seller and buyer enter into a contract for buyer to purchase 1,000 pot holders for $1,000....
Seller and buyer enter into a contract for buyer to purchase 1,000 pot holders for $1,000. Assume for purposes of this question the contract is in writing and otherwise meets all requirements of the Statute of Frauds. Buyer breaches the contract and seller resells to a local company for $900. Discuss the remedies that are available to the seller
Buyer and seller of goods enter into a shipment contract for delivery of the goods by carrier to the buyer.
Buyer and seller of goods enter into a shipment contract for delivery of the goods by carrier to the buyer. Title of these goods passes to the buyer when the (a) seller hands over the goods to the carrier (b) buyer takes the actual delivery of the goods (c) buyer receives a receipt for the goods (d) all of the above
Consider a buyer and seller who enter into a contract where the seller produces a good...
Consider a buyer and seller who enter into a contract where the seller produces a good and delivers it to the buyer for payment. At the time of making the contract, the seller is uncertain as to the actual cost of the project, and the situation is described by the following: Cost = 30 with probability 60% Cost = 70 with probability 20% Cost = 150 with probability 20% Before production occurs, the seller does learn the cost. The value...
Is a contract for the sale of real estate assignable by the buyer if it provides for credit from the seller to the buyer?
Corey sold his property to Greer, who assigned the contract right to Bob. The original contract of sale provided for an extension of credit by Corey to Greer and did not require a total cash payment at the time of closing. Is a contract for the sale of real estate assignable by the buyer if it provides for credit from the seller to the buyer? Explain.
The moment the contract goods are identified by the lessor or seller, the lessee or buyer...
The moment the contract goods are identified by the lessor or seller, the lessee or buyer has a property interest in the goods, and therefore an insurable interest.             a. This statement is true.             b. This statement is false.
a) Buyer A has entered into a contract for the sale of goods with Seller B....
a) Buyer A has entered into a contract for the sale of goods with Seller B. Seller B has delivered nonconforming goods but has promised to cure the defects. After three months of waiting, Seller B has not cured the defect. What remedy does Buyer A have?   b) Buyer A has entered into a contract for the sale of goods with Seller B. Buyer A has breached the contract while the goods are in transit. What remedy does Seller B...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT