The Risks Arising from Financial Instruments Are Typically

question 79

Multiple Choice

The risks arising from financial instruments are typically:

• A) credit risk, fair value risk and market risk.
• B) credit risk, liquidity risk and financial risk.
• C) inherent risk, liquidity risk and market risk.
• D) credit risk, liquidity risk and market risk.

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Definitions:

Cognitive Biases

Consistent departures from the norm or logical thinking in decision-making, leading to conclusions about individuals and contexts being made irrationally.

Frames in Negotiations

The subjective perspectives or interpretations individuals or groups use to understand and approach negotiation situations.

Winner's Curse

A situation in auctions or negotiations where the winner ends up overpaying or values the outcome more than its true worth.

Outcome Frame

The perspective that individuals use to evaluate the consequences of actions or decisions, often in terms of gains or losses.