An Investor with a Long Position in Treasury Notes Futures

question 39

Multiple Choice

An investor with a long position in Treasury notes futures will profit if

• A)interest rates decline.
• B)interest rate increase.
• C)the prices of Treasury notes increase.
• D)the price of the long bond increases.
• E)none of the above.

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Definitions:

Natural Comparative Advantage

A situation where a country or region can produce a particular good or service at a lower opportunity cost compared to other countries or regions.

Factor Endowments

Refers to the quantity and quality of resources a country or region has available, such as labor, land, and capital.

Heckscher-Ohlin Theorem

An economic theory stating that countries export what they can most efficiently and abundantly produce.

Labor Intensive

describes industries or production processes that require a large amount of labor relative to capital in the production process.