A Hypothesis Is

question 64

Multiple Choice

A hypothesis is:

• A) an assumption about the behavior of economic agents.
• B) a prediction of what will occur given certain assumptions.
• C) a normative statement.
• D) a forecast of future events.
• E) useful only if assumptions are realistic.

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Definitions:

Expiration Date

The specified date on which an option, futures contract, or other derivative expires, and settles by either physical delivery or cash settlement.

Convertible Bond

A convertible bond is a type of bond that can be converted into a predetermined number of the issuing company's shares at the discretion of the bondholder, typically at certain times during its life.

Conversion Value

In convertible securities, the value of the security if it were converted into a different form, such as from a bond to stock.

Straight Bond Value

The value of a bond that pays a fixed interest rate and does not have any embedded options or features.