Which of the following is least likely one of main purposes of derivative markets?
A. Reveal prices and volatility of the underlying assets
B. Improve market efficiency by lowering transaction costs
C. Enable companies to more easily practice risk management
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When market participants expect the spot price of a commodity to be higher in the future, the commodity market is most likely said to be in:
A. contango.
B. Full carry
C. backwardation
Which of the following statements concerning market structure and HerfindahI-Hirschman Index (HHI) is most accurate?
A. HHI is a useful measure of potential barriers to entry.
B. Low control over prices is characteristic of oligopolies.
C. An HHI value of 60 indicates that a market is highly competitive.
Which of these definitions of duration is most relevant to a bond investor? A bonds duration is its:
A. half-life.
B. Price sensitivity to yield changes.
C. First derivative of value with respect to its yield.
An investor sells a bond at the quoted price of $98.00. In addition he receives accrued interest of $4.40. The clean price of the bond is:
A. Par value plus accrued interest
B. Accrued interest plus agreed upon bond price
C. Agreed upon bond price excluding accrued interest.