"Equity Investments":Overview of Equity Securities

B is correct. The trader has a long forward position in the euro, which means she has committed to purchase euros in exchange for British pounds sometime in the future at an exchange rate determined when the contract was initiated. 

A is incorrect. This is a spot transaction, so there is no contract.

 C is incorrect. Forward contracts do not require holding one of the currencies; in most cases, one party will be receiving a foreign currency in the future (a payment in a foreign currency for example), and one party wishes to convert that into the domestic currency at that time without worrying about the exchange rate at the time of payment.

B is correct. Participating preference shares do not entitle the shareholders to participate in corporate decisions through voting rights. But they do entitle them to (1) an additional dividend if the company’s profits exceed a prespecified level and (2) additional distribution of the company’s assets upon liquidation, above the par. 

A is incorrect. Participating preference shares entitle the shareholders to participate in additional distribution of the company’s assets upon liquidation, above the par. 

C is incorrect. Participating preference shares entitle the shareholders to participate in additional dividend if the company’s profits exceed a pre-specific level.