The choice between futures and options
A) depends on whether the underlying instrument is a debt instrument or an equity.
B) reflects a trade-off between the higher cost of using options and the extra insurance benefits that options provide.
C) reflects a trade-off between the higher cost of using futures and the extra insurance benefits that futures provide.
D) reflects a trade-off between the greater risk from using options and the extra insurance benefits that options provide.
B
You might also like to view...
Which of the following are considered factors of production used to produce goods and services? I. Land II. Labor III. Capital IV. Entrepreneurship
A) I and II only B) I and III only C) I, II and III only D) I, II, III and IV
If a monopoly's demand curve shifts to the right, the
A) monopoly will charge a higher price. B) monopoly will charge a lower price. C) monopoly will sell more. D) monopoly's decision cannot be determined.