Question

True or False and Explain why in a paragraph: Banks have effectively reduced risk using financial...

True or False and Explain why in a paragraph:

Banks have effectively reduced risk using financial futures.

0 0
Add a comment Improve this question Transcribed image text
Answer #1

Futures are financial contracts that obligating the sellers to sell an asset or buyers to purchase an asset at a predetermined future date and price. It reduces the risk of price movement. If market participants anticipate an increase in the price of an underlying asset in future, they can gain by buying the asset in a future contract and sell it at a high price in future.

So the given statement is TRUE.

Add a comment
Know the answer?
Add Answer to:
True or False and Explain why in a paragraph: Banks have effectively reduced risk using financial...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT