How does counterparty risk influence a firm's decision to trade exchange-traded derivatives rather than over-the-counter derivatives?
What will be an ideal response?
Answer: With exchange-traded derivatives, the exchange is the clearinghouse. Thus, firms do not need to worry about the other party making good on its obligations and it is easier to trade the derivative products.
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To use single-segment pricing, a company bases the price of a product on the costs of manufacturing and marketing the product, not on the attractive savings the customers realize over the life of the product
Indicate whether the statement is true or false
List the steps of the capital budgeting process and identify actions that relate to each step.
What will be an ideal response?
The fishing lures produced by Fun Lite Corporation are unique in that they are handcrafted. Advertising by the company emphasizes the point that how its lures, unlike others, are all handcrafted. This feature is the company's:
a. publicity objective. b. marketing differentiator. c. competitive advantage. d. one-to-one marketing advantage.
Alexis sells half of her Triple A Ranch land to the Big B Ranch. On the land is a reservoir. In the deed, Alexis retains the right to remove a lim-ited amount of water per day from the res-ervoir. This right is
a. a tenancy at sufferance. b. a license. c. an easement. d. a profit.