11) What is the relationship between the price of a derivative and the price of the underlying asset?
a) They always move in the same direction
b) They always move in the opposite direction
c) They are not related
d) It depends on the specific derivative
12) What is the concept of leverage in derivatives?
a) It allows investors to make larger profits
b) It allows investors to borrow money to invest in derivatives
c) It allows investors to take larger positions with a smaller amount of capital
d) It allows investors to earn interest on their derivative investments
13) What is the profit or loss formula for a long futures position?
a) Profit or loss = final price – initial price
b) Profit or loss = initial price – final price
c) Profit or loss = final price + initial price
d) Profit or loss = initial price + final price
14) What is the profit or loss formula for a short futures position?
a) Profit or loss = final price – initial price
b) Profit or loss = initial price – final price
c) Profit or loss = final price + initial price
d) Profit or loss = initial price + final price
15) What is the maximum potential loss for a buyer of a call option?
a) The premium paid for the option
b) The strike price
c) Unlimited
d) Zero
