What is the underlying asset in the forwards contract example provided in the text?

Jewelry Currency Gold Stocks

Who is the buyer of the forwards contract in the example?

XYZ Gold Dealers ABC Jewelers The Investment Bank The Regulatory Authority

What is one of the main risks associated with forwards contracts mentioned in the text?

Market Volatility Risk Liquidity Risk Inflation Risk Interest Rate Risk

How can the forwards contract in the example be settled?

Physical Settlement only Cash Settlement only Either Physical or Cash Settlement Through a Third-Party Mediator

What is the main purpose of futures contracts compared to forwards contracts?

To increase the potential profit To provide more flexibility To reduce risks To simplify the agreement process