Which of the Following Are Advantages of Derivatives

question 24

Multiple Choice

Which of the following are advantages of derivatives?

• A)lower transaction costs than securities and commodities
• B)reveal information about expected prices and volatility
• C)help control risk
• D)make spot prices stay closer to their true values
• E)all of the above

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Definitions:

Demands of Reality

Refers to the pressures and requirements placed on individuals by the factual conditions or situations of life.

Freud

Sigmund Freud, an Austrian neurologist and the founder of psychoanalysis, a clinical method for treating psychopathology through dialogue between a patient and a psychoanalyst.

Ego

In psychoanalytic theory, the part of the mind that mediates between the conscious and the unconscious and is responsible for reality testing and a sense of personal identity.

Conscience

An individual's internal moral compass, guiding distinctions between right and wrong.