Think of a real or made up but realistic example of a speculative risk that you or someone you know may face, and then answer the
questions below.
(a) Describe the specific risk. (1-3 sentences)
(b) What sort of negative outcomes are possible for this type
of risk? (1-3 sentences. 0.5 points)
(c) What sorts of positive outcomes are possible for this type
of risk? (1-3 sentences. 0.5 points)
(d) Would this risk be likely to create unexpected expenses?
Why or why not? (1-3 sentences. 1.0 points)
(e) Describe at least one way you could protect yourself
against this risk. (1-3 sentences. 1.0 points)

How will firms solve the problem of an economic surplus a. decrease prices to the market equilibrium price b. decrease prices so they are below the market equilibrium price c.increase prices

The treasurer for pittsburgh iron works wishes to use financial futures to hedge her interest rate exposure. she will sell five treasury futures contracts at $139,000 per contract. it is july and the contracts must be closed out in december of this year. long-term interest rates are currently 7.30 percent. if they increase to 9.50 percent, assume the value of the contracts will go down by 20 percent. also if interest rates do increase by 2.2 percent, assume the firm will have additional interest expense on its business loans and other commitments of $149,000. this expense, of course, will be separate from the futures contracts. a. what will be the profit or loss on the futures contract if interest rates increase to 9.50 percent by december when the contract is closed out

If the findings and the results are not presented properly, the research completed was a waste of time and money. true false