A Derivative Is a Financial Instrument with a Value Derived

question 58

Multiple Choice

A derivative is a financial instrument with a value derived from a:

• A)regulatory body such as the FTC.
• B)primitive or underlying asset.
• C)specified risk.
• D)negotiated contract.
• E)probability of occurrence.

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Definitions:

Personal Gain

Advantages or benefits, often of a financial or material nature, pursued or achieved for oneself.

Corporate Gain

The increase in value or wealth of a business entity, typically measured in financial terms and often pursued through various strategies and operations.

Profit Motive

The incentive or drive to achieve financial gain or profit through business activities or investment.

Unsafe Products

Goods that pose potential risks to consumers due to manufacturing defects, design faults, or the lack of proper warnings and instructions.