Which Statement Below Is INCORRECT

question 9

Multiple Choice

Which statement below is INCORRECT?

• A) Arbitrageurs seek price discrepancies among securities and attempt to extract riskless arbitrage profits.
• B) Hedgers try to reduce risk by trading securities and are often cited as the chief reason for the existence of derivative markets.
• C) Position traders (also called trend followers)maintain speculative trading positions for longer periods of time.
• D) Scalpers open their positions in the morning,try to profit from price movements over the day,and close their positions at the end of the trading day.
• E) Speculators often take calculated risks in their pursuit of profits.

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Definitions:

Going Rate

The current standard price or wage rate for goods, services, or labor in a particular market or industry.

Insurance Policy

A contract between an insurance company and a policyholder that outlines the terms and conditions under which the insurer agrees to compensate the insured for specific losses.

High Deductible

A health insurance plan feature requiring a higher out-of-pocket payment before insurance coverage begins.

Co-Payments

Fixed amounts paid by an insured person for covered services, in addition to what the insurance covers.