Investors who do not consider risk in their decisions are said to be
a. speculating
b. short selling
c. risk neutral
d. traders
e. none of the above
Answer: C
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FIN402 Chapter 1
- When the law of one price is violated in that the same good is selling for two different prices, an opportunity for what type of transaction is created?
- The expected return minus the risk-free rate is called
- In which one of the following types of contract between a seller and a buyer does the seller agree to sell a specified asset to the buyer today and then buy it back at a specified time in the future at an agreed future price.
- The process of selling borrowed assets with the intention of buying them back at a later date and lower price is referred to as
- The process of creating new financial products is sometimes referred to as
- Which of the following contracts obligates a buyer to buy or sell something at a later date?
- Which of the following statements is not true about the law of one price
- Which of the following markets is/are said to provide price discovery?
- Which of the following trade on organized exchanges?
- A market in which the price equals the true economic value
- Options on futures are also known as
- A forward contract has which of the following characteristics?
- Which of the following are advantages of derivatives?
- A transaction in which an investor holds a position in the spot market and sells a futures contract or writes a call is
- The positive relationship between risk and return is called
- Which of the following instruments are contracts but are not securities
- A call option gives the holder
- Cash markets are also known as
- The market value of the derivatives contracts worldwide totals
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