If You Took a Short Position in Two S&P 500

question 23

Multiple Choice

If you took a short position in two S&P 500 futures contracts at a price of 1,510 and closed the position when the index futures was 1,492, you incurred

• A)a gain of $9,000.
• B)a loss of $9,000.
• C)a loss of $18,000.
• D)a gain of $18,000.
• E)None of the options

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Definitions:

Type I Error

The incorrect rejection of a true null hypothesis, also known as a "false positive," occurring when a statistical test falsely indicates the presence of an effect.

Type I Error

A statistical error made by rejecting the null hypothesis when it is actually true, known as a false positive.

Type II Error

The failure to reject a false null hypothesis, also known as a "false negative."