Final answer:
An interest rate futures contract is a contract that allows for the purchase of a specified debt security for a specified price at a future point in time. b. interest rate futures contract.
Step-by-step explanation:
The correct answer is b. interest rate futures contract.
An interest rate futures contract is a contract that allows for the purchase of a specified debt security, such as a bond, for a specified price at a future point in time. It is an agreement between two parties to buy or sell an interest rate futures contract at a predetermined price and time.
For example, if an investor expects interest rates to rise in the future, they can enter into an interest rate futures contract to lock in the current interest rate. This can protect them from potential increases in interest rates and allow them to purchase the debt security at a lower price than it may be in the future.