1. What is a contango market? A) The one where the local rate is higher than the foreign rate B) The one where the local rate is the same as the foreign rate C) The one where the local rate is lower than the foreign rate 2. What is a backwardation market?  A) The one where the local rate is higher than the foreign rate B) The one where the local rate is the same as the foreign rate C) The one where the local rate is lower than the foreign rate 3. How do you find the price of a call if the price of the underlying is $20 and its strike price is $15?  A) In the Money B) At the Money C) Out the Money 4. What is the risk of a buyer of an interest rate swap (IRS)?  A) Rates go up B) Rates go down 5. What is the risk of a seller of an interest rate swap (IRS)?  A) Rates go up B) Rates go down 6. How is the position of an interest rate swap (IRS) buyer? A) Long rates B) Short rates C) You can not say 7. What is the position of a seller of an interest rate swap (IRS)?  A) Long rates B) Short rates C) You can not say