In General, When Deciding Whether a Market Participant Needs to Buy

question 35

Multiple Choice

In general, when deciding whether a market participant needs to buy or sell futures contracts in order to hedge, the rule could be:

• A) buy futures if you have the underlying asset and sell futures if you need the underlying asset.
• B) sell futures if you have the underlying asset and buy futures if you need the underlying asset.
• C) buy futures if you want to speculate, sell futures if you want to hedge.
• D)buy futures if you are willing to have unlimited risk, sell futures if you want capped risk.

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Definitions:

Labia Minora

The inner two folds of skin surrounding the vaginal opening, part of the female external genitalia.

Fertilization

The fusion of male and female gametes to form a zygote.

Uterine Tubes

Tubes that extend from the uterus to the ovaries, responsible for transporting the ovum or egg.

Ovary

The female reproductive organ that produces eggs and hormones like estrogen and progesterone.