1. An investor would want to __________ to exploit an expected rise in interest rates.
Take a long position in treasury bond futures
Sell treasury bond futures
Buy S&P 500 index futures
Take a short position in oil futures
Take a long position in wheat futures
2. The current level of the S&P 500 is 1,160. The dividend yield on the S&P 500 is 2%. The risk-free interest rate is 3%. The futures price for a contract on the S&P 500 due to expire 6 months from now should be __________ (use the continuously compounding interest rate method).
$1,137.49
$1,165.81
$1,190.00
$1,132.17
$1,075.04