15) One distinction between futures and options contracts is that to an option contract to transact at a later date. A)

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15 One Distinction Between Futures And Options Contracts Is That To An Option Contract To Transact At A Later Date A 1 (44.91 KiB) Viewed 70 times

15) One distinction between futures and options contracts is that to an option contract to transact at a later date. A) one party; is not obligated B) both parties; are not obligated C) one party; is obligated D) both parties; are obligated 16) A is an instrument in which the issuer (debtor/borrower) promises to repay to the lender/investor the amount borrowed plus interest over some specified period of time. A) bond B) common stock C) preferred stock D) T-bill 17) We can distinguish between a security's which can be washed away by mixing the security with other securities in a diversified portfolio, and its which cannot be eliminated by diversification. A) systematic risk; unsystematic risk B) portfolio risk; systematic risk C) unsystematic risk; T-Bill risk D) unsystematic risk; systematic risk 18) The rate of interest is determined by interaction of the supply and demand functions. As a cost of borrowing and a reward for lending, the rate must reach the point where total supply of savings total demand for borrowing and investment. A) equilibrium; is greater B) minimum; equals C) equilibrium; equals D) minimum; is greater 19) The public (consisting of individuals and firms) holds money for several reasons. Which of the below is three of these? A) Difficulty of translations, precaution against expected events, and speculation about possible rises in the interest rate. B) Ease of transactions, precaution against unexpected events, and speculation about possible rises in the interest rate. C) Ease of unexpected events, precaution against transactions, and speculation about possible rises in the interest rate. D) Speculation about transactions, fear against unexpected events, and precaution about possible rises in the interest rate. 20) The riskless rate is 5.00% and the return on the market is 10.00%. If you form a portfolio with a beta of 0.8, what should be your rate of return according to the CAPM? A) 8.00% B) 8.50% C) 9.00% D) 9.50%