Macrohedging Uses a Derivative Contract, Such as a Futures or Forward

question 3

True/False

Macrohedging uses a derivative contract, such as a futures or forward contract, to hedge a particular asset or liability risk.

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Definitions:

Contactor Unit

An electromechanical switch used for switching an electrical power circuit, similar to a relay but with higher capacity.

Switch Contacts

The conductive parts of a switch that come together or separate to make or break an electrical circuit.

Mechanical Linkage

A system of interconnected levers or gears which transmits and modifies motion in machinery.

Power Failure

A condition where the electrical power supply to a device, system, or area is interrupted or lost.