Which of the Following Statements Is NOT True About Derivatives

question 14

Multiple Choice

Which of the following statements is NOT true about derivatives?

• A) Derivatives are a newcomer to financial markets in the past fifty years.
• B) Derivatives help to complete markets.
• C) Derivatives are regulated by either the Securities and Exchange Commission or the Commodity Futures Trading Commission.
• D) Derivatives usually require models to determine hedge ratios.
• E) Derivatives can be used incorrectly if not well understood.

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Definitions:

Customers Served

The total number of customers who receive service or products from a business within a given time period.

Revenue

The total amount of income generated from the sale of goods or services before any expenses are subtracted.

Spending Variances

Differences between the actual spending and the budgeted or planned spending in a given period, often analyzed in cost and managerial accounting.

Customers Served

The number of clients or customers that have been provided with services or goods by a business within a certain timeframe.