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Question 1 (1 point) If I am short a futures contract today when the futures price $15/bushel, and then tomorrow the futures price moves to $15.45/bushel, I suffer a loss and definitely won't get a margin call O I earn a profit and might get a margin call earn a profit and definitely won't get a margin call I suffer a loss and might get a margin call Question 2 (1 point) The date is April 24, 2022. You own the stock, now worth 47.50. If you also collar the stock using strike prices of 47 and 49, then if the stock price finishes at 50 at maturity, then you have a ____ Ignore commissions and dividends. Stock price = Calls Puts 47.50 Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 O Profit of 1.93 Profit of 2.57 Profit of 1.43 Profit of 0.93 Question 3 (1 point) The date is April 24, 2022. If you enter into a short straddle using a strike price of 48, you are betting that volatility will be through the option maturity date. Stock price = 47.50 Calls Puts Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 O Low High Question 4 (1 point) You own the stock, now worth 47.50. If you also buy a put with a strike price of 48, if the stock price finishes at 47 at maturity, then you have a Ignore commissions Stock price = 47.50 Calls Puts Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 Loss of 1.76 Loss of 2.26 O Loss of 1.26 Profit of 1.26 Question 5 (1 point) The date is April 24, 2022. If you buy a July call with a strike of 48 and the stock price finishes at 52.50 on the expiration date, you have a - Ignore commissions. Stock price = Calls Puts 47.50 Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 Profit of 2.24 O Profit of 1.78 Profit of 3.21 Profit of 2.67 Question 6 (1 point) The date Is April 24, 2022. If you buy a July put with a strike of 49 and the stock price finishes at 44 on the expiration date, you have a ... Ignore commissions. Stock price = 47.50 Calls Puts Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 Profit of 2.28 O Profit of 1.78 O Profit of 2.67 Profit of 3.21 Question 7 (1 point) The stock price is $30. There is one year until option expiration. The stock is expected to pay $1 in present value of dividends over the next year. The price of a put option with a strike price of $30 is $3. According to the put-call parlty theorem, if the risk-free rate of Interest is 5%, the value of the call with a strike price of $30 should be O $3.95 $3.43 $3.09 O $3.91 O $2.95 Question 8 (1 point) A protective put strategy is most appropriate for an Investor that Is bullish on the stock and expects high volatility O Is bullish on the stock and expects low volatility O Is bearish on the stock and expects low volatility O Is bearish on the stock and expects high volatility Question 9 (1 point) The date is April 24, 2022. Which of the following July call options is most likely to be exercised at maturity? Stock price - Calls Puls 47.50 Strike Price July July 47 2.43 1.86 18 1.83 2.28 49 1.29 2.72 50 0.80 3.23 Strike price of 47 O Strike price of 48 Strike price of 49 Strike price of 50 Question 10 (1 point) On January 2, you sold one May mini-S&P 500 futures contract at a futures price of 4.200. If the futures price is 4,150 on February 1 your profit or loss is complete a reversing trade (the contract multiplier is $50). Ignore commissions, If you $5,000 profit $5,000 loss O $2,500 profit $2.500 loss Question 11 (1 point) If you enter into a short straddle using a strike price of 48, if the stock price finishes at 49 at maturity, then you have a Ignore commissions. Stock price = Calls Puts 47.50 Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 O Profit of 1.26 O Profit of 0.83 O Profit of 2.26 Profit of 3.09 Question 12 (1 point) The date is April 24, 2022. You own the stock, now worth 47.50. If you also write a call with a strike price of 48, if the stock price finishes at 47 at maturity, then you have a {gnore commissions and dividends. Stock price = Calls Puts 47.50 Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 Profit of 0.83 o Loss of 1.83 o Loss of 1.00 Profit of 1.33 Question 13 (1 point) Suppose that according to the put-call parity formula, the fair value of the call is $3, but the actual market price of the call is 55. Then the trading strategy to earn an arbitrage profit would include Buying the call Writing the call Question 14 (1 point) The date is April 24, 2022. If you buy a July call with a strike of 49 and the stock price finishes at 48 on the expiration date, you have a ignore commissions. Stock price = 47.50 Calls Puts Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 Profit of 2.29 Loss of 2.29 Profit of 0.29 Loss of 1.29 Question 15 (1 point) Use the D2L file, "March 31 Futures Settlement Prices for the next series of questions. Which is the more reasonable explanation for the difference between the May 22 and the May 23 Corn futures settle prices? O traders expect the supply of corn will be higher in May 2023 than in May 2022 O traders expect the supply of corn will be lower in May 2023 than in May 2022 Question 16 (1 point) Given the difference between the May 22 and the May 23 Corn futures settle prices, then for a farmer that owns some extra corn in a silo, it would make more sense to O sell May 23 Com futures, if the storage cost is less than $0.635 per bushel per year O sell May 22 Corn futures Question 17 (1 point) The closing cash (spot) price for Yellow #2 corn was $7.28/bushel on March 31. 2022. If I am a speculator, and expect the price of corn to go up rapidly between now and July 2022, I should Assume the annual Interest rate for borrowing money is 3%, and the cost of storing corn for 4 months is $0.20/bushel. O buy corn in the spot market buy July 2022 Corn futures Question 18 (1 point) Starting with the Jun 22 Gold futures settle price, if the cost of storing gold for six months, paid at the end, is $4/ounce, and the annualized interest rate to borrow money is 3%, then the theoretical Dec 22 Gold futures settle price is 1993.3 1982.5 1987.1 1973.4 1989.2 1967,8 O 1991.6 1986.1 Question 19 (1 point) Continuing the previous question, is there an arbitrage opportunity from buying Jun 22 Gold futures and selling Dec 22 Gold futures? No, there isn't Yes, there is Question 20 (1 point) Starting with the Jun 22 E-mini S&P 500 futures settle price, if the annual interest rate to borrow money is 3%, and the FV of dividends paid on the index over the year between the two futures expirations is 65, then the theoretical Jun 23 E-mini S&P 500 futures settle price is O4566.7 4559.9 4545.1 4584.8 4563.0 4565.8 O 4601.7 Question 21 (1 point) Continuing the previous question, is there an arbitrage opportunity from buying Jun 22 E-mini S&P 500 futures and selling Jun 23 E-mini S&P 500 futures? Yes, there is No, there isn't Question 22 (1 point) On April 3, 2022, suppose I own Wal-Mart stock, now $100/share, and want to partially hedge my risk without selling my stock. I should consider O Buying Wal-Mart July puts with a strike of 95 Buying Wal-Mart July calls with a strike of 105 Question 23 (1 point) Which futures contract has the lower maintenance margin requirement? O 30-year Treasury Bond futures Each of these contracts has the same maintenance margin requirement O 10-year Treasury Note futures Question 24 (1 point) If you buy a July put with a strike of 48 and the stock price finishes at 44 on the explration date, you have a Ignore commissions Stock price - 47.50 Puts Calls Strike Price July July 47 2.43 1.86 48 1.83 2.26 49 1.29 2.72 50 0.80 3.23 Profit of 2.28 Profit of 2.17 Profit of 1.74 Profit of 3.21 Question 25 (1 point) If a jewelry manufacturer wanted to hedge against possible silver price increases they might want to sell silver futures contracts O buy silver futures contracts Question 26 (1 point) On April 22, 2022, suppose Lyft stock trades at $55. If I want to speculate that the price of Lyft stock will go down over the next three months, I should consider O Buying Lyft July calls with a strike of 55 Buying Lyft July puts with a strike of 55

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