Which of the Following Statements About Derivatives Is Correct

question 48

Multiple Choice

Which of the following statements about derivatives is correct?

• A)Both futures and options represent zero-sum games.
• B)Futures represent a zero-sum game,but options do not.
• C)Options represent a zero-sum game,but futures do not.
• D)Neither options nor futures represents a zero-sum game.

---

Definitions:

Skimming Demand

A pricing strategy that involves setting high prices initially to target consumers willing to pay more, before lowering the price over time to attract a broader market.

Prestige Pricing

A pricing strategy where prices are set high to create a perception of exclusivity and high quality, often used for luxury goods.

High-quality Product

A product that surpasses ordinary standards of performance, durability, and design, and meets or exceeds customer expectations.

Penetration Pricing

Penetration pricing is a marketing strategy used to attract customers to a new product or service by offering a lower price initially.