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Long futures contracts are more attractive than long forward positions for the same underlying and maturity when futures prices and interest rates are:
Explanation:
The correct answer is C because the cash flow patterns of forwards and futures differ, leading to variations in their pricing. When futures prices are positively correlated with interest rates, long futures contracts become more attractive than long forward positions for the same underlying and maturity. This is due to the reinvestment of futures profits during periods of rising interest rates and the occurrence of losses during periods of falling interest rates, making the futures contract more desirable and thus priced higher.