the economics of money, banking, and financial markets

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Economics of Money, Banking & Financial Markets, 5e (Mishkin)
Chapter 14 Risk Management with Financial Derivatives

14.1 Hedging

1. 
   

   Financial derivatives include ____.
   A) stocks
   B) bonds
   C) futures
   D) foreign exchange
   Answer: C
   Diff: 1 Type: MC Page Ref: 323
   Skill: Recall
   Objective List: 14.1 Distinguish among forwards, futures, options, and swaps

   
   


2. 
   

   Financial derivatives include ____.
   A) stocks
   B) bonds
   C) forward contracts
   D) foreign exchange
   Answer: C
   Diff: 1 Type: MC Page Ref: 323
   Skill: Recall
   Objective List: 14.1 Distinguish among forwards, futures, options, and swaps

   
   


3. 
   

   A contract that requires the investor to buy securities on a future date is called a ____.
   A) short position
   B) long position
   C) hedge
   D) cross
   Answer: B
   Diff: 1 Type: MC Page Ref: 323
   Skill: Recall
   Objective List: 14.1 Distinguish among forwards, futures, options, and swaps

   
   


4. 
   

   A contract that requires the investor to sell securities on a future date is called a ____.
   A) short position
   B) long position
   C) hedge
   D) micro hedge
   Answer: A
   Diff: 1 Type: MC Page Ref: 323
   Skill: Recall
   Objective List: 14.1 Distinguish among forwards, futures, options, and swaps