The Country Farm and the Cookie Maker met today and agreed to exchange wheat six months from now at a price which they negotiate

Question

3 years ago

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The Country Farm and the Cookie Maker met today and agreed to exchange wheat six months from now at a price which they negotiate

d today. This agreement was made between the two firms and did not pass through an organized exchange. Which one of the following best describes this transaction?

Social Studies

1 answer:

slamgirl [31] · Answer 1 · 2022-05-22T20:49:02+03:00

Answer:

Forward contract

Explanation:

forward contract is a non-standardized contract between two individuals (the buyer and seller) who agree to buy and sell a good on a future date at a specific price. Unlike the future contract, forward contract is not standardized and parties can easily breach agreements made because it is traded over the counter thus the risk is high.