All of the Following Are Non-Hedging Strategies That Can Be

question 41

Multiple Choice

All of the following are non-hedging strategies that can be used to manage business risk EXCEPT:

• A)acquisition of additional information
• B)forward contracts
• C)diversification
• D)insurance

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Definitions:

Compounded Annually

The process of adding the accumulated interest back to the principal sum at the end of each year, so that interest is earned on interest from that point forward.

Accountant

An accountant is a professional who performs accounting functions such as audits or financial statement analysis according to prescribed methods.

Retire

To retire means to withdraw from active working life, often due to reaching a certain age or completing enough years of service to qualify for pension benefits.

Compounded Annually

The process of earning interest on both the initial principal and the accumulated interest from previous periods on a yearly basis.