1. Giving the purchaser the right to sell the underlying security at a prespecified price is a

put option.

call option.

naked option.

futures option.

credit spread call option.

2. Capital structure refers to:

A. the determination of the ideal mix of current versus long-term assets.

B. the methods by which fixed assets are used to produce a tangible product.

C. the mix of current assets and current liabilities.

D. the acquisition or disposition of a building or other long-term asset.

E. decisions related to long-term debt and equity financing.

3. An FI would normally purchase a cap if it was funding fixed-rate assets with variable-rate liabilities.

True

False