The Purpose of Derivatives Is To

question 73

Multiple Choice

The purpose of derivatives is to:

• A) increase the risk so the return is larger.
• B) eliminate risk for both parties in the transaction.
• C) postpone the risk for both parties in the transaction.
• D) transfer the risk from one person to another.

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Definitions:

Inorganic Molecules

Chemical compounds lacking a carbon-based structure, excluding carbonates and bicarbonates, that are typically found in non-living matter.

Hydrothermal Vents

Openings in the ocean floor that release heated water rich in minerals, supporting unique ecosystems based on chemosynthesis rather than photosynthesis.

Mass Depletion

refers to the significant reduction of natural resources or materials on Earth due to human activities or natural processes.

Extinction Rate

The rate at which species and populations of organisms die out over time, often accelerated by human activities and environmental changes.