3.Which of the following statement regarding clearing hours in futures market is wrong?

a.Clearing house collects margin

b.Clearing house allows the offsetting contracts before expiration

c.Clearing house absorbs all the default risks

d.There is only one clearing house in the exchange

e.Long and shorts do not meet each other directly, but contract clearing house

4.Suppose the 90 -day LIBOR=3%. At the expiration, which one of the following two derivative product offers higher amount at expiration? Suppose we have one forward and one futures, both with notional amount of $10,000,000

a.Higher amount in the future market

b.Higher amount in the forward market

c.Same amount

d.Cannot determine because lack of information

5.Which one of the following is the not correct about the comparison between futures and forwards?

a.Futures are standardized and forwards are not

b.Futures are traded on exchange and forward are OTC

c.Short in both forward and futures can determine the method of delivery

d.Futures market have clearing house and forward does not

e.Exiting the futures make is easier than forward