Which of the Following Statements Is false

question 15

Multiple Choice

Which of the following statements is false?

• A) Derivatives help shift risk from risk-adverse investors to risk-takers.
• B) Derivatives assist in forming cash prices.
• C) Derivatives provide additional information to the market.
• D) In many cases, the investment in derivatives (both commissions and required investment) is more than in the cash market.
• E) None of the above (that is, all are reasons)

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Definitions:

μ

The symbol representing the mean or average of a population in statistics.

σ

The symbol for standard deviation in statistics, representing the dispersion or variability of a set of data points.

Normally Distributed

A type of distribution where data points are symmetrically distributed around the mean, forming a bell-shaped curve.

Exponential Distribution

A continuous probability distribution used to model the time between events in a Poisson point process, characterized by a constant mean rate or rate parameter.