36) True or False: Swaps are commonly used for hedging interest rate risk.
37) True or False: Swaps can only be traded on organized exchanges.
38) What is the notional amount in a swap contract?
a) The amount of money that must be paid to purchase the swap
b) The amount of money that must be exchanged between the parties in the swap
c) The total value of the underlying asset in the swap
d) The difference between the strike price and the market price of the underlying asset
39) What is a credit default swap?
a) A swap that protects against default on a specific debt obligation
b) A swap that protects against changes in interest rates
c) A swap that protects against changes in the price of a specific stock
d) A swap that protects against currency exchange rate risk
40) What is a commodity futures contract?
a) A contract to buy or sell a physical commodity at a specific price on a future date
b) A contract to borrow money to invest in commodities
c) A contract to invest in commodity stocks
d) A contract to hedge against risk in commodity markets
