1.Strengthening basis improves ______'s position, and weakening basis improves _______'s position.

a.Short hedger; Long hedger

b.Long hedger; Short hedger

c.Short hedger; Short hedger

d.Long hedger; Long hedger

e.Neutral hedger; Short hedger

2.All else equal, when the cost of carry is ________ than the convenience yield, the forward/futures prices __________ with contract maturity.

a.greater; do not change

b.greater; increase

c.smaller; increase

d.greater; decrease

e.smaller; do not change

3._____ hedgers incur losses on futures position when the futures price is ______ over time; and ______ hedgers incur losses on futures position when the futures price is _______ over time.

a.long; falling; short; falling

b.long; increasing; short; increasing

c.short, falling; long; increasing;

d.long; falling; short; increasing

e.long; steady; short; steady