If Investors Speculate in Derivative Contracts Rather Than the Underlying

question 61

Multiple Choice

If investors speculate in derivative contracts rather than 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:

Valuable Human Resource

Refers to employees who are highly beneficial to an organization due to their skills, talents, and contributions.

Labor

The effort by people to produce goods or services that have economic value.

Event Timing Forecast

The prediction of when certain events are likely to occur, often used in planning and strategy development.

Market

An economic system that allows buyers and sellers to exchange goods and services.