Products & Their RisksQuestion 105 of 398
Which of the following is a common type of direct participation program?
a.A real estate limited partnership
b.A federally insured bank certificate of deposit
c.An open-end money market mutual fund
d.A U.S. Treasury note
Explanation
Common DPPs include real estate, oil and gas, and equipment-leasing limited partnerships, which let investors participate directly in the cash flow and tax consequences of the underlying venture. CDs, money market funds, and Treasuries are not DPPs because they lack the direct pass-through partnership structure.
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