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Question
What is the purpose of a credit forward agreement?
A. To allow property-casualty insurers to hedge the extreme losses that occur after major catastrophes.
B. To adjust prices on outstanding futures each day to reflect current futures market conditions.
C. To facilitate the future exchange of an asset for cash at a price that is determined daily.
D. To hedge a cash asset on a direct dollar-for-dollar basis with a forward or futures contract.
E. To hedge against an increase in the default risk of a loan.
Answer
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Related questions
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E. product liability and farm owner multiple peril.
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The McCarran-Ferguson Act of 1945
A. separated commercial banking from insurance activities.
B. mandated federal insurance company charters.
C. stipulated that insurance companies are to be regulated at the state level.
D. initiated a national insurance guaranty fund.
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A. the expected payment commitment on existing policy contracts.
B. a fund established and held separately from the company's other assets.
C. the cash value paid to the policyholder if the policy is terminated before it matures.
D. the same as the endowment payout.
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A. Position trading.
B. Pure arbitrage.
C. Liquidity trading.
D. Risk arbitrage trading.
E. Program trading.
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A. has publicly-traded common stock.
B. provides equity funds to companies that already have publicly traded common stock.
C. is a subsidiary of a nonfinancial corporation.
D. provides debt funding to only to established corporations.
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Which of the following would be a key area of activity for an investment bank specializing in the commercial side of the business?
A. Purchase of existing securities.
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C. Brokerage of existing securities.
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