15.6. [Introductory Derivatives Sample Question 30] Determine which of the following is NOT a distinguishing characteristic of futures contracts, relative to forward contracts. (A) Contracts are settled daily, and marked-to-market. (B) Contracts are more liquid, as one can offset an obligation by taking the opposite position. Contracts are more customized to suit the buyer's needs. (D) Contracts are structured to minimize the effects of credit risk. (E) Contracts have price limits, beyond which trading may be temporarily halted. 15.7. An investor buys 25 contracts of one-year S&P 500 futures. Each contract is for the delivery of 250 units of the index. The spot price of the index is 1900. The futures price of the index is the forward price. The continuously compounded risk-free interest rate is 0.04, and the index pays no dividends. After one day, the spot price of the index remains 1900. Calculate the mark-to-market for that day. 15.8. Bob takes a long position in one contract of S&P 500 futures. Each contract is for the delivery of 250 units of the index at a price of 1800 per unit. The initial margin is 10% of the notional value and the maintenance margin is 80% of the initial margin. Interest on the margin account is paid at an annual continuously compounded rate of 5%. The first mark-to-market occurs one week (7 days) after the sale of the contract. Determine the lowest value of the futures contract not requiring a margin call. 15.10. [Introductory Derivatives Sample Question 32] Judy decides to take a short position in 20 contracts of S&P 500 futures. Each contract is for the delivery of 250 units of the index at a price of 1500 per unit, exactly one month from now. The initial margin is 5% of the notional value, and the maintenance margin is 90% of the initial margin. Judy earns an annual continuously compounded interest rate of 4% on her margin balance. The position is marked-to-market on a daily basis. On the day of the first marking-to-market, the value of the index drops to 1498. On the day of the second marking-to-market, the value of the index is X and Judy is not required to add anything to the margin account Calculate the largest possible value of X. (A) 1490.50 (B) 1492.50 (C) 1500.50 (D) 1505,50 (E) 1507.50