Description of Transaction

Type of Market

Karl spends $$1,500$ to buy Google stock options through his online brokerage account.

Financial asset markets

Description of Transaction

Type of Market

You need gasoline now, so you drive to the gas station and purchase $10$ gallons of

Spot markets

gasoline.

Description of Transaction

Type of Market

Abbey allocates $80\%$ of her portfolio for investments in short$-$term US Treasury bills.

Capital markets

Description of Transaction

Type of Market

The state of California issues new bonds to the public with an investment bank serving as the underwriter to raise capital.

A corn processor in Nebraska has decided to purchase a futures contract for corn. The contract will increase in value if the price of corn rises, thereby offsetting the processors' increased costs$/$decreased net income. In this example, the corn processor is