In which of the following categories would an agreement to trade currencies in pre-set amounts at a certain date in the future be included?
a. an option
b. a futures contract
c. a forward contract
d. a swap
Ans: b. a futures contract
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In the figure below, a firm that is using peak load pricing produces ________ in the peak period and produces ________ in the off-peak period.
A) 4,000; 2,000
B) 4,000; 1,000
C) 3,000; 3,000
D) None of the above answers are correct because more information is needed about the combined marginal revenue curves
How much is this firm's output?
Which of the following distinguishes a natural monopoly from monopoly caused by ownership of a vital resource?
A. The natural monopoly has a marginal cost curve above its average cost curve at all levels of output, whereas the marginal cost in other monopolies is above average cost. B. The natural monopoly does not require any government intervention because it is only efficient to have one large firm supplying the market, but other monopolies do require government intervention to maintain efficiency. C. The natural monopoly has a downward-sloping long-run average cost curve as opposed to a U-shaped long-run average cost curve. D. The natural monopoly occurs with naturally occurring products like gold and diamonds, whereas other monopolies occur with man-made products.
Chris has a one-hour break between classes every Wednesday. Chris can either stay at the library and study or go to the gym and work out. The decision Chris must make is:
A. not an economic problem because neither activity costs money. B. an economic problem because Chris has only one hour, and engaging in one activity means giving up the other. C. not an economic problem because it's an hour that Chris has no matter what he does. D. an economic problem because the tuition Chris pays covers the cost of both the gym and the library.