Q2. Which of the following is correct? (A) Forward contracts are traded in exchange-traded derivatives markets (B) Forward contracts are subject to monthly settlement (C) Forward Price (Fo) is contracted now and will be used for a transaction in the future (D) Forward contracts have no default risk Answer: Q3. Which of following should be used by investors to hedge against a decrease in the S&P index? (A) Long Futures on the S&P index (B) Long Call Options on the S&P index (C) Short Futures on the S&P index (D) Long Forward on the S&P index