The, Eraditional purpose of futures matkets is to provide an feportane opportuni
ID: 2802258 • Letter: T
Question
The, Eraditional purpose of futures matkets is to provide an feportane opportunity A. for'agrieultural cooperatives to sell their products. icuitus to uture productien and price trends in agricultural markets C. D. To hedge against the risk of adverse price movements. all of the above. 3 Futures contracts A. are limited to agricultural cransactions B. are spot eransactions c. require an initial margin from pareie: D. one of the above 36 ption grants the buyer the right to purchase the designated trunent from the writer (seller), it is referred to as a A. options are only for sales, not purchases. B. call or call option C. D. none of the above forvard contract When the option buyer,has the right to sell the designated instrument t the writer (seller), ic is referred to as a(n) A options are only for purchases, mot sales. B. call or cal1 option yo. put or put option. sales contract or "salco". D. . An option instrument whereby the buyer may exercise the option only at . the expiration date is called a(an) A. closing date option. B. European option C. al1 options must be exercised before the expiration date. D. American option. The contractual obligation in an option contract ends on the date A. exchange B. maturity expiration B and C D. Options written on groups of stock are called A. index options B. hedges C. equity options D. none of the above 4 Options aze designated by A. the name of the underlying common stock. the expiration month the strike price. the type of option (put or call). C. D. E. al1 of the aboveExplanation / Answer
37. D. all of above
Traditional purpose of the future market was to a. Provide opportunity to agricultural cooperatives b. Hedge against risk c. Forecasting the trends and future productions.
38. C. They require initial margin from parties
39. C. Call option is the right to purchase any asset on a future date but not the obligation.
40. C. Put option gives the buyer the right to sell at predetermined price.
41. A. European options are exercised only at expiry.
42. D. At maturity or expiration the option contract ends.
43. A. Index options are options written on group of stocks.
44. D. All of the above.
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