User Account

All Pages

Find month of expiration

Assignment Help Finance Basics
Reference no: EM133110086

Please Choose the correct answer below. No explanation is needed.

1. If you can exercise option anytime prior to and including the expiration date, the option is an ______ Option

a. Underwater

b. out of the money

c. in the money

d. American style

e. European style

2. The futures price is less than the cash price is an ____ market.

a. arbitrage

b. buyer's

c. parity

d. inverted

e. carrying-charge

3. You will receive a margin call every time your margin:

a. exceeds the required maintenance margin

b. is less than the initial margin

c. increases

d. is less than the required maintenance margin

e. decreases.

4. An option quotation is listed as "GED-BD". The month of expiration is ___ and the strike price is _______

a. July, $10

b. February: $10

c. July: $20

d. February: $20

e. May : $10

5. A futures Contract:

(i) is standardized when traded on an exchange

(II) is a zero-sum game

(III) has a net value of zero

(IV) is a derivative security

a. I and IV only

b. I, II, III and IV

c. I, II and IV only

d. II and III only

e. I and II only

6. which of the following are classified as derivative securities?

a. Preferred stock

b. options

c. money market instruments

d. futures.

7. The two key consideration when determining the delivery mechanism for a futures contract are

a. day of deliveries and low cost

b. location to seller and convenience

c. location to seller and day of delivery

d. location to buyer and day of delivery

e. low cost and convenience

8. if spot-futures parity exists on a financial future , then the future price must equal.

a. future value of the spot price at the risk-free rate

b. future value of the spot price at the market rate

c. present value of the spot price at the risk-free rate

d. spot price

e. present value of the spot price at the market price.

9. In a carrying-charge market, the

a. cash price will exceed the futures price

b. basis will equal zero

c. cash and futures prices create an arbitrage opportunity

d. basis will be negative

e. cash price will equal the future price

10. the primary reasons why commodity futures prices tend to be higher than spot prices is attributed to the cost of:

a. taking delivery and storage

b. arbitrage and interest

c. entering futures contract and taking delivery

d. entering a futures contract and then closing out that position

e. storage and interest

Reference no: EM133110086

Questions Cloud

Example customised and integrated applications : Example customised and integrated applications and Explore the technologies and techniques used to customise and integrate applications
What would be the effect under the straight-line : What would be the effect on the following under the straight-line, sum-of-the-years'-digits, and double-declining-balance depreciation methods
Trading of a physical asset : 1. What is the term for the trading of a physical asset against it's futures price in order to earn a "risk-free" profit?
Investigate the customisation and integration of application : Investigate the customisation and integration of applications used by organisations to meet their needs - write a report in which you evaluate how and why custo
Find month of expiration : 1. If you can exercise option anytime prior to and including the expiration date, the option is an ______ Option
Prepare the journal entry to record Juan investment : Juan contributed the following to JM Partnership: Prepare the journal entry to record Juan's investment in the partnership
Federal income tax return : 1. Dave bought a rental property for $560,000 cash. One year later, he sold it for $575,000. What was the return on his $560,000 investment?
Contemporary thinking about global leadership : Discusses how leaders must have a vision when leading organization globally. How does this article contribute to contemporary thinking about global leadership.
What are the best-case and worst-case npvs : McGilla Golf has decided to sell a new line of golf clubs. The clubs will sell for $840 per set and have a variable cost of $400 per set. The company has spent

Reviews

Write a Review

Finance Basics Questions & Answers

  The bonds are first sold

&J Enterprises wants to issue eighty 15-year, $1,000 zero-coupon bonds. If each bond is priced to yield 9%, how much will J&J receive (ignoring issuance costs) when the bonds are first sold?

  How do the equity multipliers compare

How does the asset utilization ratio for a bank compare to that of a retail company? How do the equity multipliers compare?

  Allocate the building-related costs

Would you recommend that TRU continue to allocate the building-related costs only to the preschool program? What alternative allocation method would you Suggest

  Objective type questions on current assets and liabilities

Objective type questions on current assets and liabilities and Which of the following statements is CORRECT

  What are the four inventory models

Define inventory and discuss why inventories are maintained. What are the four Inventory Models?

  Shareholders interests rather than their own

Are managers of firms with formidable takeover defenses more or less likely to act in the shareholders' interests rather than their own?

  5 trends in the administrative management

Elaborate on 5 trends in the Administrative Management and General Management consulting, 541611:

  What is the expected return on rkp

The risk-free rate of return is currently 0.04, whereas the market risk premium is 0.05. If the beta of RKP, Inc., stock is 1.4, then what is the expected return on RKP?

  Cost reconciliation report under the fifo method

In the cost reconciliation report under the FIFO method, the costs to be accounted for equals the cost of beginning work in process inventory plus the cost of units transferred out.

  Breckenridge skicompany has total assets of 422235811 and

breckenridge skicompany has total assets of 422235811 and a debt ratio of 29.5 percent. calculate the companys

  What is the price of the bond now

Several years ago, Castles in the Sand Inc. issued bonds at face value of $1,000 at a yield to maturity of 7.6%.

  Recall that treasury bonds pay interest semiannually

Recall that Treasury bonds pay interest semiannually. Use the modified duration valuation equation

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd