Which of the Following Statements Is True of a Not-For-Profit

question 20

Multiple Choice

Which of the following statements is true of a not-for-profit organization?

• A) It makes profits.
• B) It does not pay expenses.
• C) It can earn excess revenue.
• D) It cannot operate like a business.
• E) It rewards the proprietor of the organization with earned profits.

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Definitions:

Selling A Call Option

The action of granting someone the right, but not the obligation, to buy a specific amount of the underlying asset at a set price within a specified time frame.

Obligation To Sell

A commitment or requirement to sell an asset or security, often arising from a contractual agreement.

Protective Put

An investment strategy where an investor buys a put option for an asset they own to hedge (protect) against a potential drop in the asset's price.

Riskless Asset

An investment with a certain rate of return and no risk of default, often represented by treasury bills or similar government securities.