Which of the following is most likely true when one claims that derivatives makes the world...

Which of the following is most likely true when one claims that derivatives makes the world risker?

a.) Derivatives affect the instruments on which they are based—the tail wagging the dog.

b.) Derivatives may increase price volatility due to programed trading or portfolio insurance.

c.) Derivatives encourage risk-taking because they have natural leverage.

d.) Derivatives, rather than the users of derivatives, are to be blamed for many firms losing money.

Expert Solution

jeff jeffy answered 1 year ago

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