Quiz Ch 24 – T/F Futures Contracts: Specialized Forward Contracts
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
True or false: Futures contracts are specialized versions of forward contracts.
True or false: Futures contracts are specialized versions of forward contracts.
True or false: Using real estate futures contracts is a strategy for investors to hedge against changes in house prices.
True or false: Hedging could enhance a company’s debt capacity.
True or false: The question of whether companies should always leave investors to hedge for themselves is subjective.
True or false: Margin is required from both the seller and buyer in a futures contract.
True or false: Mark-to-market applies to forward contracts.
True or false: To safeguard against declining oil prices, an oil producer would sell, rather than buy, crude oil futures.
True or false: Firms employ options for speculation rather than risk reduction.
True or false: Insurance is effective in risk reduction when the company can diversify risk across multiple policies.
True or false: Speculators are essential for the efficient functioning of futures markets.