A future contract A. Is traded on exchanges B. Is an agreement to buy or sell a specified amount of an asset at whatever the spot price happens to be on the expiration date of the contract C. Is a contract to be signed in the future by the buyer and the seller of a commodity D. Gives the buyer the right, but not the obligation, to buy an asset some time in the future Is an agreement to obtain the right to buy or sell a specified amount of an asset at a predetermined price on the expiration date of the E. contract QUESTION 6 The rate at which large banks in London (and elsewhere) lend to each other is called A. Fed fund rate B. Eurodollar rate C. LIBOR D. Commercial paper rate E. Banker's acceptance rate What do you conclude about the accuracy of the two rules (duration rule versus duration-with-convexity rule) in predicting the change of bond price due to yield change? A. It depends on the duration of a bond. B. They have the similar accuracy. C. It depends on the convexity of a bond. D. The duration-with-convexity rule provides less accurate approximations to the actual change in price. E. The duration rule provides less accurate approximations to the actual change in price. QUESTION 8 performance over the long term, even though they tend to exhibit performance initially. Initial public offerings often show A. Good; bad B. Bad; bad C. Bad; good D. Good; good