If Investors Speculate in the Underlying Asset Rather Than Derivative

question 66

Multiple Choice

If investors speculate in the underlying asset rather than derivative contracts on the underlying asset, they will probably achieve ____ returns, and they are exposed to relatively ____ risk.

• A)lower; lower
• B)lower; higher
• C)higher; lower
• D)higher; higher

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Definitions:

Supplier Performance

The evaluation of how effectively and efficiently a supplier meets the requirements and expectations set by the buyer, including delivery, quality, and cost.

Intermediary

An intermediary acts as a middleman in the distribution chain, facilitating transactions between producers and end users.

Relationships

Connections or interactions between individuals or organizations that influence business operations and outcomes.

Production Economies

Advantages that result from efficiency improvements in the production process, often achieved through increased scale, technology advancements, or optimized resource allocation.