1. Why are companies with higher operating leverage and or high finacial leverage more risky? ( hint break even) Remember operating leverage is the extend a company utilizes fix costs. Financial leverage is the company's use of debt to finance the business.
2. What is the spot market for FX? What is the forward market for FX? What is the position of being net long in a currency?
3. What is the difference between an investment-grade bond and a junk bond?