WorksheetsChapter 5 Class Activity 20254
Total questions: 13
Worksheet time: 13mins
What is a futures contract?
A loan agreement
A right to buy an asset
An obligation to buy/sell at a future date
A stock certificate
Which of the following is true about options contracts?
They give the right but not the obligation
They are mandatory to execute
They involve physical delivery only
They are only used by banks
Options contracts always require the buyer to execute the trade.
True
False
Futures contracts are standardized and traded on exchanges.
True
False
Which of the following is a type of option style?
Malaysian
European
Institutional
Retail
You are a farmer worried about falling palm oil prices. Which derivative helps you lock in a selling price today?
Call Option
Common Stock
Futures Contract
Bond
You expect a stock to rise but want limited risk. Which strategy suits you best?
Buy a bond
Sell a futures contract
Buy a call option
Buy a put option
Which of the following match this term: Obligation
Futures
Strike price
Options
Premium
Which of the following match this term: Right
Futures
Options
Exercise price
Premium
Which of the following match this term: Strike Price
Futures
Options
Exercise Price
Premium
Which of the following match this term: Cost of options
Futures
Options
Exercise price
Premium
The (a) price is the price at which the option holder can buy or sell the underlying asset.
Which of the following is a risk of using futures contract?
Guaranteed profit
Unlimited loss potential
No market regulation
Fixed returns
