Financial instruments used primarily to transfer risk would include all of the following, except:
A. an insurance contract.
B. options.
C. a futures contract.
D. a bank loan.
Answer: D
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"A doubling of the price of gasoline in the 1970s did not reduce consumption one iota." The person making the above claim evidently thinks the demand for gasoline is
A) completely elastic. B) completely inelastic. C) greater than the supply. D) less than the supply. E) unit elastic.
Holding all else constant, when a bank receives the funds for a deposited check
A) cash items in the process of collection fall by the amount of the check. B) bank assets increase by the amount of the check. C) bank liabilities decrease by the amount of the check. D) bank reserves increase by the amount of required reserves.
For any competitive labor market, what change would have to occur to cause the labor supply to decrease and shift the supply curve left?
A. Number of firms increases B. None of these statements is true. C. Number of workers increases D. Opportunity cost of work increases
You are considering buying a share of stock in Company ABC. At the end of years 1, 2, and 3 the stock will pay you a dividend of $10 . In addition, at the end of the third year you expect to sell the share of stock for $200 . If the interest rate is 5%, how much is the share of ABC stock worth to you today?
a. $200 b. $210 c. $220 d. $230