Question

How are exchange-traded derivatives characterized?

a.

High transaction cost

b.

Low liquidity

c.

High liquidity and financial engineering for risk management

d.

Limited investment avenues

Posted under IC 89 Management Accounting

Answer: (c).High liquidity and financial engineering for risk management Explanation:Exchange-traded derivatives are characterized by high liquidity and provide a mechanism for financial engineering for risk management with low transaction costs.

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Q. How are exchange-traded derivatives characterized?
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