Derivatives transfer risk from one person or firm to another. They can be used in any combination
Question:
Derivatives transfer risk from one person or firm to another. They can be used in any combination to unbundle risks and resell them.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 33% (3 reviews)
Derivatives do indeed transfer risk from one person or firm to another They are financial instruments whose value derives from an underlying asset reference rate or other variables Derivatives can be ...View the full answer
Answered By
Michael Owens
I am a competent Software Engineer with sufficient experience in web applications development using the following programming languages:-
HTML5, CSS3, PHP, JAVASCRIPT, TYPESCRIPT AND SQL.
5.00+
1+ Reviews
10+ Question Solved
Related Book For
Money Banking And Financial Markets
ISBN: 9781260226782
6th Edition
Authors: Stephen Cecchetti, Kermit Schoenholtz
Question Posted:
Students also viewed these Business questions
-
Let A, B be sets. Define: (a) the Cartesian product (A B) (b) the set of relations R between A and B (c) the identity relation A on the set A [3 marks] Suppose S, T are relations between A and B, and...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
Options have advantages and disadvantages. One of the advantages is the possibility of controlling actions without having them. Possibility of obtaining a higher return on investment, with less...
-
Based on Exhibit 1, the expected future value of Bond I at maturity is closest to: A. 98.80. B. 103.74. C. 105.00. Lena Liecken is a senior bond analyst at Taurus Investment Management. Kristel...
-
1. How does a city's decision to assess substantial fines on rail operators that persistently generate traffic congestion affect the supply curve for rail services within the city? 2. Why do you...
-
Osbert Company is a canned cat food manufacturer. The basic meat ingredients are fish, pork and beef, and all of these ingredients are supplied by an outside vendor. The production Writing floor of...
-
John Oldfield is feeling under pressure. His desk is covered with market research reports, data from the accounts department regarding sales and profits figures, sales representatives records and...
-
The December 31, 2009 balance sheet of the Blackmon Corporation disclosed the following information relating to its receivables: *The company is contingently liable for a discounted note receivable...
-
PROBLEMS 6 - 1 Swift Bicycles plans to issue convertible bonds to finance its future growth. Each convertible bor a face value equal to $ 1 , 0 0 0 and car into 2 5 shares of common stock. Whi mum...
-
Futures contracts are standardized contracts for the delivery of a specified quantity of a commodity or financial instrument on a prearranged future date, at an agreed- upon price. They are a bet on...
-
The following table shows the interest rates on the fixed and floating borrowing choices available to three firms. Firms A and B want to be exposed to a floating interest rate while Firm C would...
-
What is the major defect of the cash basis of accounting?
-
The issue of Royal Rose Manufacturing Co., Ltd. with many new employees is the low level of production. Although the company implements training programs for employees, the skill improvement of...
-
For safety reasons an elevator stops with an acceleration of g/3 in the case of an emergency. Let's assume an unusually high ceiling of the elevator to hang three sections lamp one below the other...
-
Can Google be characterized as a monopoly? Justify your answer by specifying and comparing the characteristics of a monopoly with those of Google. What is competition law? How would you justify the...
-
In the case below design and draw a Rich Picture that identifies the key stakeholders, actors, power and decision-making authorities. The novel coronavirus has turned the world upside down as a...
-
1. Two spherical stars A and B have densities PA and PB, respectively. A and B have the same radius, and their masses MA and M are related by MB = 2M. Due to an interaction process, star A loses some...
-
In some instances, when a depository institution borrower cannot make the promised principal and interest payment on a loan, the bank will extend another loan for the customer to make the payment. a....
-
Evaluate the function at the given value(s) of the independent variable. Simplify the results. (x) = cos 2x (a) (0) (b) (- /4) (c) (/3) (d) ()
-
Has the distinction between direct and indirect forms of finance become more or less important in recent times? Why?
-
Give two examples of how greater financial inclusion might benefit a small farmer who previously did not have access to modern finance.
-
How might broader access to finance benefit a country where access was previously very limited?
-
ABC Company engaged in the following transaction in October 2 0 1 7 Oct 7 Sold Merchandise on credit to L Barrett $ 6 0 0 0 8 Purchased merchandise on credit from Bennett Company $ 1 2 , 0 0 0 . 9...
-
Lime Corporation, with E & P of $500,000, distributes land (worth $300,000, adjusted basis of $350,000) to Harry, its sole shareholder. The land is subject to a liability of $120,000, which Harry...
-
A comic store began operations in 2018 and, although it is incorporated as a limited liability company, it decided to be taxed as a corporation. In its first year, the comic store broke even. In...
Study smarter with the SolutionInn App