Which One of the Following Best Describes the Purpose of Derivatives

question 32

Multiple Choice

Which one of the following best describes the purpose of derivatives markets?

• A) Transferring risk from one party to another.
• B) Investing for a short time period to earn a small rate of return.
• C) Investing for retirement.
• D) Earning interest income.

---

Definitions:

Distributive Bargaining

A negotiation strategy focused on dividing a fixed amount of resources, where any gain for one side is a loss for the other.

Integrative Negotiation Process

Involves a series of steps aimed at finding creative solutions that satisfy all parties involved in a negotiation.

Identifying

The process of recognizing and naming someone or something.

Collaboration

Working jointly with others or together especially in an intellectual endeavor to achieve a common goal.