Futures Market Transactions Are Used to Reduce Risk

question 1

Multiple Choice

Futures market transactions are used to reduce risk.Risk may not be totally offset if:

• A)the two instruments have different maturities.
• B)payoff schedules of the two instruments are different.
• C)the volatility of the two instruments are different.
• D)the price movements are not perfectly correlated.
• E)All of the above.

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Definitions:

Bowles and Gintis

Sociologists known for their work on education and its role in reproducing social inequalities.

Hidden Curriculum

Unspoken or implicit lessons learned in school, outside of the official curriculum, which convey cultural norms, values, and perspectives.

Functionalists

Scholars or theorists who view society as a complex system whose parts work together to promote stability and social order.

Authority

The power or right to give orders, make decisions, and enforce obedience.