Derivative Markets Exist in Order to

question 6

Multiple Choice

Derivative markets exist in order to

• A)allow for the direct cash sale of common stock.
• B)allow for the direct cash sale of bonds.
• C)reduce the risk of exposure to price fluctuations in cash markets.
• D)overcome some of the information problems involved in trades on the over-the-counter market.

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Definitions:

Intermediary

A person or entity that acts as a mediator or middleman to facilitate communication or negotiation between two parties.

Repertoire of Behaviors

A range or collection of behaviors that an individual can exhibit in different situations.

Culture-As-Learned-Behavior

The concept that culture is a set of behaviors, values, and norms learned from the society or group one belongs to.

Distributive

Pertaining to the allocation or distribution of resources or benefits among people or groups.