Financial institutions and the government may reduce interest-rate risk by:

	A.	engaging in interest-rate swaps.
	B.	not altering the interest rates that they receive and/or pay when market interest rates change.
	C.	Both of the answers are correct.
	D.	None the answers is correct.

An increase in the market price of the underlying asset will cause the price of a call option to:

	A.	rise.
	B.	fall.
	C.	remain unchanged.
	D.	change in an unpredictable manner.

Futures markets may be used for speculating or for hedging. The difference between these strategies is:

	A.	that speculators attempt to reduce their risk while hedgers increase their risk in an attempt to receive higher returns.
	B.	that hedgers attempt to reduce their risk while speculators increase their risk in an attempt to receive higher returns.
	C.	nonexistent; both hedgers and speculators attempt to reduce their risk.
	D.	nonexistent; both hedgers and speculators increase their risk in an attempt to receive higher returns.