Options Are Popular Because of All of the Following EXCEPT

question 1

Multiple Choice

Options are popular because of all of the following EXCEPT:

• A) stock prices are volatile.
• B) they offer a tool to transfer risk.
• C) they present a tool to limit losses but also limit gains.
• D) they offer opportunities for high leverage.

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Definitions:

Net Wealth

The total value of all financial and non-financial assets owned by an individual, company, or country, minus any debts.

Interest Rates

The cost of borrowing or the reward for saving, typically expressed as a percentage of the amount loaned or saved over a specified period.

Consumption

denotes the act of using goods and services for personal or collective needs, often a major component of GDP.

Consumption Function

It is an economic formula representing the relationship between total consumption and gross national income, suggesting that consumption patterns are directly related to income levels.