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Agata [3.3K]
3 years ago
12

Suppose that you enter into a short futures contract to sell July silver for $17.20 per ounce. The size of the contract is 5,000

ounces. The initial margin is $4,000, and the maintenance margin is $3,000. What change in the futures price will lead to a margin call? What happens if you do not meet the margin call?
Business
1 answer:
ivanzaharov [21]3 years ago
7 0

Answer:

$0.20

Explanation:

For computing the change in future price, first we have to determine the loss which is shown below:

Loss = Initial Margin - Maintenance Margin

        = $4,000 - $3,000

        = $1,000

Now the change in future price would be

= Loss ÷ size of the contract

= $1,000 ÷ 5,000 ounces

= $0.20

The future price is increased by $0.20

And, if the margin call is not meet than the broker will stop at best price so that he cannot suffer more loss

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Answer:

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5 0
2 years ago
Read 2 more answers
Which category (or type) of consumer products are: (1) relatively expensive, (2) infrequently purchased, and (3) buyers are will
artcher [175]

Answer:

consumer products provided are categorized thus:

(1) relatively expensive: a computer system

(2) infrequently purchased:  A car

(3) buyers are willing to expend considerable effort in planning and making purchases: A house

Explanation:

Consumer products are defined as products that satisfy a consumer's wants or needs. There can be convenient, affordable as well as expensive and infrequently purchased.

Consumer goods are final goods sold to consumers for  use. It is usually not used as means for further economic production activity.

Some consumer goods are durable and can last for up to three years or more while some are perishable with expiry dates and must be consumed within a short pace of time.

Finally, consumer goods can be grouped into different categories based on consumer behavior depending on how frequently they are used.

7 0
3 years ago
Zanny Moldings has the following estimated costs for the upcoming year:
Sloan [31]

Answer:

D) $31.

Explanation:

The computation of the predetermined overhead rate is shown below:  

Predetermined overhead rate = Estimated manufacturing overhead ÷ estimated direct labor hours

where,

Estimated manufacturing overhead is

= Salary of factory supervisor + Heating and lighting costs for factory + Depreciation on factory equipment

= $37,600 + $22,000 + $5,600

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And, the direct labor hours is 2,100

So, the predetermined overhead rate is

= $65,200 ÷ 2,100

= $31

5 0
3 years ago
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