1. The primary derivative instruments in use today are

Question options:

	A. real estate loans
	B. Treasury bonds
	C. plan vanilla derivatives
	D. futures, options, and swaps.
	E. Municipal bonds

2. AIG almost went bankrupt in 2008 because

Question options:

	A.the value of the securities underlying its credit default swaps declined significantly.
	B. it lacked the collateral required by buyers of its credit default swaps.
	C. prices of securities underlying their credit default swaps were hard to determine since they were no longer actively traded.
	D. All of these.

3. A call option is said to be "out of the money" if the

Question options:

	A. strike price equals the exercise price.
	B. stock price equals the strike price.
	C. stock price exceeds the strike price.
	D. strike price exceeds the stock price.