Answer the following questions completely based upon your reading.

1) Explain the purpose of options markets.

2) List the major terms of an option contract and give a brief description of their meaning.

3) Describe the Greeks and their purpose when trading options.

4) Define implied volatility and it relationship to trading.

5) Explain the differences between historical and implied volatility. Include the strengths and weaknesses of each.

6) Describe the concept of put-parity and how it is related to volatility.

7) Discuss how implied volatility may be used to estimate price movement. Be certain to give the equation used and its meaning.

8) State how to calculate single day implied volatility. In addition, give the equation and its logic.

9) Describe the components of the VIX.

10) Explain the implications of a rising or falling VIX index.

11) State how to calculate expected 30-day market movements. In addition, give the equation and its logic.