Which of the Following Is/are Elements of a Derivative

question 27

Multiple Choice

Which of the following is/are elements of a derivative?

• A)A derivative has one or more underlyings.An underlying is an observable variable such as a specified interest rate, or commodity price, or foreign exchange rate.
• B)A derivative has one or more notional amounts.A notional amount is a number of currency units, bushels, shares, or other units specified in the contract.
• C)A derivative sometimes requires no initial investment.
• D)Derivatives typically require, or permit, net settlement, which means that when the counterparties settle the derivative contract, one of the contracting parties pays the other the fair value of the contract.
• E)all of the above

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Definitions:

No Eye Contact

This refers to a communication behavior where individuals avoid looking directly into each other's eyes during interaction, often interpreted differently across cultures.

Power Distance

The extent to which less powerful members of organizations and institutions accept and expect power to be distributed unequally.

Assertiveness

The quality of being self-assured and confident without being aggressive, allowing for clear and respectful communication of one's opinions and needs.

Collectivism

A cultural value that prioritizes group goals over individual goals and emphasizes the importance of cohesion within social groups.