The Relationship Between the Spot and Futures Prices of Financial

question 64

Multiple Choice

The relationship between the spot and futures prices of financial futures is given by

• A)[Futures price] = Spot price × (1 + r_f)^t (where r_f = risk-free rate).
• B)[Futures price] = Spot price × (1 + r_f − y)^t (where y = dividend yield or interest rate).
• C)[Futures price] = Spot price × (1 + r_m)^t (where r_m = market rate of return).
• D)[Futures price] = Spot price × (1 + r_m − r_f)^t.

Evaluate the impact of outliers on mean, median, and standard deviation.

Understand the role of correlation coefficients in determining the relationship between variables.

Recognize the ethical considerations and limitations of correlational and experimental research methods.

Distinguish between different measures of central tendency and variability and their applications in real-life contexts.

---

Definitions:

Wage Rate

The amount of compensation an employee receives per unit of time or per task completed, typically expressed in terms of dollars per hour.

Marginal Revenue Product

The supplementary income derived from the deployment of an extra unit of a production resource, like manpower or assets.

Rent

A regular payment made by a tenant to an owner for the use of the owner's property or land.

Complementary Resource

An asset or input that increases the utility or productivity of another asset or input when used in conjunction.