1. Why might a variable rate mortgage be considered a "derivative" and a fixed rate mortgage not?

2. Why would a corn farmer, who maintains a short futures contract after harvesting and selling her crop, be considered a speculator?

3. for families employed and living in " company towns " ( i.e., where the major employer owns all homes, retail stores, etc.), explain the lack of diversification.

4. Describe the concept of a bid-ask spread and how that impacts the cash flows of an investor.