Options May Have Advantages Over Futures for Some Investors Because

question 26

Multiple Choice

Options may have advantages over futures for some investors because

• A)Options have a lower margin requirement
• B)Options provide more efficient hedging
• C)Some investors are prohibited by law from participating in the futures market
• D)None of the above

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Definitions:

Purchase Order Processing

The administrative procedure of managing and executing purchase orders from requisition to payment and receipt of goods.

Facility-Level Activity

Operations and actions at the plant or facility level that are necessary for production but not tied to specific units produced.

Batch-Level Activity

Operations or tasks that are performed for each batch of goods produced, irrespective of the overall production volume.

Direct Labour-Hours

The total hours of labor directly involved in production, used to allocate costs or measure productivity.