Which of the Following Statements Is True Regarding Management of Investments

question 47

Multiple Choice

Which of the following statements is True regarding management of investments?

• A) Arbitrage rules apply only to general obligation bonds issued by governments.
• B) Derivatives are reported at fair value on the financial statements.
• C) Total return targets should be determined based solely on maximizing return.
• D) A sound investment strategy focuses on long-term returns of the fund.

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Definitions:

Liquidated Damages

are a predetermined amount of money agreed upon in a contract that one party will pay to the other in the event of a breach.

Liquidated Damages

A predetermined sum agreed upon by the parties to a contract to be paid as compensation in the event of a breach.

UCC

stands for the Uniform Commercial Code, a set of laws that provide legal standards and regulations for commercial transactions in the United States.

Non-breaching Seller

A seller who has complied with the terms of a contract and has not violated any conditions or obligations.