Derivatives can be strictly defined

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Which of the following is the reason why economic sticklers would not consider shares /equities as financial instruments:

A. Shares represent part-ownership in the company and are not redeemable

B. Companies can re-purchase their shares

C. Preferred shares are closer to debt instruments

D. Companies can have debt and shares, they are substitutes for each other

2. Derivatives can be strictly defined as

A. Financial instruments

B. Securities with strong economic foundations

C. Contracts that may lead to profits or losses

D. Representatives of “claims” of holders on issuers

Reference no: EM131192460

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