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marissa [1.9K]
3 years ago
7

2.) Which of the following is true? A. The convenience yield is always positive or zero. B. The convenience yield is always posi

tive for an investment asset. C. The convenience yield is always negative for a consumption asset. D. The convenience yield measures the average return earned by holding futures contracts.
Business
1 answer:
charle [14.2K]3 years ago
7 0

Answer:

The correct answer is letter "A": The convenience yield is always positive or zero.

Explanation:

The convenience yield reflects the premium of possessing an asset instead of one of its derivates or contracts. This situation arises in front of inverted markets, where holding the asset itself may bring more profits than purchasing a derivate of the same asset.

<em>The convenience yield tends to be positive or zero because the prices of assets cannot fall below zero. In other words, they are not negative.</em>

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1 year ago
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ZanzabumX [31]

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4 0
3 years ago
The legal contract between the bondholders and the issuer is called the bond ______.
Simora [160]

The legal contract between the bondholders and the issuer is called the bond <u>indenture.</u>

A bond indenture is important as it helps to protect the interest if the stakeholders and also lowers the chance of default.

It should be noted that the indenture list provides the details of a bond. It helps in ensuring transparency. Therefore, the legal contract between the bondholders and the issuer is called the bond indenture.

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