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The questions are similar to those attached. Let me know if you understand these concepts

If the initial margin is $5,000, the maintenance margin is $3,500 and your balance is $3,100, how much must you deposit? Student Answer: $1,500 $400 $1,900 0 none of the above Points Received: 3.3 of 3.3 Comments: -875095445 MultipleChoice 1 True 0 -875095445 MultipleChoice 1 Question 2 Question : . Student Answer: The number of futures contracts outstanding is called the reportable position minimum volume open interest spread position none of the above Points Received: Comments: 3.3 of 3.3 -875095444 MultipleChoice 2 True 0 -875095444 MultipleChoice 2 Question 3 Question : . Most futures contracts are closed by Student Answer: delivery offset exercise default none of the above Points Received: 3.3 of 3.3 Comments: -875095443 MultipleChoice 3 True 0 -875095443 MultipleChoice 3 Question 4 Question : . Student Answer: Most forward contracts are closed by delivery offset exercise default none of the above Points Received: 3.3 of 3.3 Comments: -875095442 MultipleChoice 4 True 0 -875095442 MultipleChoice 4 Question 5 Question : . Which of the following is not a forward contract? Student Answer: a long-term employment contract at a fixed salary an automobile lease non-cancelable for three years a rain check a signed contract to buy a house in six months none of the above Points Received: 3.3 of 3.3 Comments: -875095441 MultipleChoice 5 True 0 -875095441 MultipleChoice 5 Question 6 Question : . Student Answer: Which of the following duties is not performed by the clearinghouse? holding margin deposits guaranteeing performance of buyer and writer maintaining records of transactions lending money to meet margin requirements none of the above Points Received: 3.3 of 3.3 Comments: -875095440 MultipleChoice 6 True 0 -875095440 MultipleChoice 6 Question 7 Question : . The trading procedure on the floor of the futures exchange is referred to as Student Answer: against actuals open interest open outcry index participation none of the above Points Received: 3.3 of 3.3 Comments: -875095439 MultipleChoice 7 True 0 -875095439 MultipleChoice 7 Question 8 Question : . Student Answer: Futures prices differ from spot prices by which one of the following factors? the systematic risk the cost of carry the spread the risk premium none of the above Points Received: 3.3 of 3.3 Comments: -875095438 MultipleChoice 8 True 0 -875095438 MultipleChoice 8 Question 9 Question : . Suppose there is a risk premium of $0.50. The spot price is $20 and the futures price is $22. What is the expected spot price at expiration? Student Answer: $21.50 $22.50 $20.50 $24.50 none of the above Points Received: 0 of 3.3 Comments: -875095437 MultipleChoice 9 False 0 -875095437 MultipleChoice 9 Question 10 Question : . Student Answer: Suppose it is currently July. The September futures price is $60 and the December futures price is $68. What does the spread of $8 represent? the cost of carry from July to September the expected risk premium from July to September the cost of carry from September to December the expected risk premium from September to December none of the above Points Received: 3.3 of 3.3 Comments: -875095436 MultipleChoice 10 True 0 -875095436 MultipleChoice 10 Question 11 Question : . Student Answer: The spot price plus the cost of carry equals the convenience yield the expected future spot price the risk premium the futures price none of the above Points Received: 0 of 3.3 Comments: -875095435 MultipleChoice 11 False 0 -875095435 MultipleChoice 11 Question 12 Question : . Student Answer: Margin in a futures transaction differs from margin in a stock transaction because stock transactions are much smaller delivery occurs immediately in a stock transaction no money is borrowed in a futures transaction futures are much more volatile none of the above Points Received: 0 of 3.3 Comments: -875095434 MultipleChoice 12 False 0 -875095434 MultipleChoice 12 Question 13 Question : . Student Answer: Individuals engaging in this type of trading strategy are characterized by their attempt to profit from guessing the direction of the market hedgers spreaders speculators arbitraguers none of the above Points Received: 3.3 of 3.3 Comments: -875095433 MultipleChoice 13 True 0 -875095433 MultipleChoice 13 Question 14 Question : . Despite the fact that forward contracts carry more credit risk than futures contracts, forward contracts offer what primary advantage over futures contracts? Student Answer: the over-the-counter forward market is a highly regulated market forward contracts prevent the writer from assuming the credit risk of the buyer terms and conditions are tailored to the specific needs of the two parties involved transaction information between the two parties involved in the forward contract is readily available to the public conditions of the forward contract, such as delivery date and location, cannot be altered Points Received: 3.3 of 3.3 Comments: -875095432 MultipleChoice 14 True 0 -875095432 MultipleChoice 14 Question 15 Question : . Student Answer: This individual takes a futures contract position that is opposite to the position in the spot market in order to reduce risk speculator hedger risk aversion maximizer spreader arbitraguer Points Received: 3.3 of 3.3 Comments: -875095431 MultipleChoice 15 True 0 -875095431 MultipleChoice 15 Question 16 Question : . Student Answer: Which of the following correctly orders the process of daily settlement? clearinghouse officials establish a settlement price; each account is marked to market; accounts of those holding long/short positions are credited/debited appropriately; differences between today's settlement price and the previous days settlement price are determined clearinghouse officials establish a settlement price; each account is marked to market; differences between today's settlement price and the previous day's settlement price are determined; accounts of those holding long/short positions are credited/debited appropriately differences between today's settlement price and the previous day's settlement price are determined; accounts are marked to market; clearinghouse officials establish a settlement price; accounts of those holding long/short positions are credited/debited appropriately clearinghouse officials establish a settlement price; differences between today's settlement price and the previous days settlement price are determined; accounts of those holding long/short positions are credited/debited appropriately; each account is marked to market differences between today's settlement price and the previous day's settlement price are determined; accounts are marked to market; clearinghouse officials establish a settlement price; accounts of those holding long/short positions are credited/debited appropriately Points Received: 3.3 of 3.3 Comments: -875095430 MultipleChoice 16 True 0 -875095430 MultipleChoice 16 Question 17 Question : . Student Answer: Why is the initial value of a futures contract zero? the futures is immediately marked-to-market you do not pay anything for it the basis will converge to zero the expected profit is zero because the futures price and spot price will be the same at expiration Points Received: 0 of 3.3 Comments: -875095429 MultipleChoice 17 False 0 -875095429 MultipleChoice 17 Question 18 Question : . Student Answer: The value of a long position in a forward contract at expiration is the spot price plus the original forward price the spot price minus the original forward price the original forward price discounted to expiration the spot price minus the original forward price discounted to expiration Points Received: 3.3 of 3.3 Comments: -875095428 MultipleChoice 18 True 0 -875095428 MultipleChoice 18 Question 19 Question : . Student Answer: The value of a futures contract immediately after being marked to market is numerically equal to the daily settlement amount the spot price plus the original forward price equal to the amount by which the price changed since the contract was opened simply zero none of the above Points Received: 3.3 of 3.3 Comments: -875095427 MultipleChoice 19 True 0 -875095427 MultipleChoice 19 Question 20 Question : . Student Answer: Under uncertainty and risk aversion, today's spot price equals the expected future spot price, minus the storage costs, minus the interest forgone, minus the risk premium the expected future spot price, minus the storage costs, minus the interest forgone, plus the risk premium the expected future spot price, minus the storage costs, minus the risk premium future spot price minus the cost of storage none of the above Points Received: 0 of 3.3 Comments: -875095426 MultipleChoice 20 False 0 -875095426 MultipleChoice 20 Question 21 Question : . Student Answer: The implied repo rate is similar to the internal rate of return cost of hedging yield on the futures contract all of the above none of the above Points Received: 0 of 3.3 Comments: -875095425 MultipleChoice 21 False 0 -875095425 MultipleChoice 21 Question 22 Question : . Student Answer: If a firm is planning to borrow money in the future, the rate it is trying to lock in is the current forward rate the current spot rate the difference between the spot rate and the forward rate the forward rate at the termination of the hedge none of the above Points Received: 3.3 of 3.3 Comments: -875095424 MultipleChoice 22 True 0 -875095424 MultipleChoice 22 Question 23 Question : . Student Answer: You are trying to see if there is an arbitrage opportunity. Current US interest rate is 6.6%. The spot rate for US/EUR is 0.8 while the forward rate for a year is 0.82. If the current interest rate in Germany is 4%. What should be done? Borrow in US and convert money to Euros, invest in Germany and after a year convert back to US dollars. Borrow in Germany and convert to US dollars at spot rate, invest in US and after a year convert back to Euros at forward rate Borrow Euros in Germany and invest in Germany, wait for a year and then convert to dollars using the forward rate. Borrow dollars in US, invest in US, wait for a year and convert to Euros at Forward rate and invest in Germany There is no arbitrage with these numbers, so you must invest in your native nation Points Received: 3.3 of 3.3 Comments: -875095423 MultipleChoice 23 True 0 -875095423 MultipleChoice 23 Question 24 Question : . Student Answer: A transaction in which an investor holds a position in the spot market and sells a futures contract or writes a call is a gamble a speculative position a hedge a risk-free transaction none of the above Points Received: 3.3 of 3.3 Comments: -875095422 MultipleChoice 24 True 0 -875095422 MultipleChoice 24 Question 25 Question : . Student Answer: Which of the following are advantages of derivatives? lower transaction costs than securities and commodities make spot prices stay closer to their true values help control risk all of the above 2 and 3 only Points Received: 3.3 of 3.3 Comments: -875095421 MultipleChoice 25 True 0 -875095421 MultipleChoice 25 Question 26 Question : . Student Answer: A forward contract has which of the following characteristics? has a buyer and a seller trades on an organized exchange has a daily settlement gives the right but not the obligation to buy all of the above Points Received: 3.3 of 3.3 Comments: -875095420 MultipleChoice 26 True 0 -875095420 MultipleChoice 26 Question 27 Question : . A market in which the price equals the intrinsic value has a risk-free component Student Answer: will be profitable is organized is efficient all of the above Points Received: 0 of 3.3 Comments: -875095419 MultipleChoice 27 False 0 -875095419 MultipleChoice 27 Question 28 Question : . Student Answer : Arbitrage is a transaction designed to capture profits resulting from market efficiency True Points Received: False 3.3 of 3.3 Comments: -875095418 TrueFalse 1 True 0 -875095418 TrueFalse 1 Question 29 Question : . Determine the annualized implied repo rate on a Treasury bond spread in which the March is bought at 52.7 and the June is sold at 53.5. The March CF is 1.1 and the June CF is 1.14. The accrued interest as of March 1 is 1.1 and the accrued interest as of June 1 is 1.3. (due to calculator precision, pick the closest answer) Student Answer: 23% 2.3% 13% 3.5% 4.5% Points Received: 0 of 3.3 Comments: -875095417 MultipleChoice 28 False 0 -875095417 MultipleChoice 28 Question 30 Question : . Student Answer: The difference between UCIRP and CIRP is that UCIRP includes expected future spot rate while CIRP includes future rate. True