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Multiple Choice Quiz
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1
In a derivatives transaction, one person’s loss is always another person’s gains.
A)True
B)False
2
A forward contract is a futures contract that has been standardized and is sold through an organized exchange.
A)True
B)False
3
A call option is the right to buy a given quantity of an underlying asset at a predetermined price.
A)True
B)False
4
Options allow investors to hedge particular risks.
A)True
B)False
5
Interest-rate swaps are an example of the exchange of future payoffs.
A)True
B)False





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