Multiple Choice
If the firm must buy silver in the future and thus pay for the metal in the future, management may reduce the risk of loss from an increase in the price of silver by
A) taking a long position and entering a contract to buy silver
B) taking a short position and entering a contract to deliver silver
C) accepting delivery early
D) refusing to accept delivery if the price rises
Correct Answer:
Verified
Correct Answer:
Verified
Q2: A futures contract to make delivery is
Q3: Swap agreements are one means to help
Q4: If the futures price falls,<br>1) the short
Q5: If interest rates increase, the short sellers
Q6: If an individual has a contract to
Q7: Swap agreements<br>A) transfer ownership<br>B) transfer liabilities<br>C) transfer
Q8: When a stock index futures contract expires,
Q9: When speculators invest in commodity futures, they<br>A)
Q10: As a result of the small margin
Q11: The buyers (the longs) and not the