Which Statement Is Correct About Financial Instruments

question 71

Multiple Choice

Which statement is correct about financial instruments?

• A)A contract whose value changes according to a specified variable, requires little or no initial investment and is settled at a future date.
• B)A contract that gives the holder the residual interest in an entity after deducting all of its liabilities.
• C)Any contract that gives rise to a financial asset for one entity and a financial liability or equity instrument for another entity.
• D)Any contract that entitles the holder to joint interest in an entity after deducting all of its liabilities.

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Definitions:

BIRG-ing Phenomenon

"Basking in Reflected Glory," a psychological phenomenon where individuals associate themselves with successful others to improve their self-esteem or status.

Extrinsic Sources

Factors external to an individual that influence their behavior and decisions, such as rewards or social pressures.

Downward Social Comparisons

The act of comparing oneself to others who are perceived as worse off in order to feel better about one's own situation.

Self-Handicapping

The behavior of creating obstacles or excuses for oneself to avoid blame in case of failure or poor performance.