Which of the Following Is Necessary for Tailing a Hedge

question 10

Multiple Choice

Which of the following is necessary for tailing a hedge?

• A) Comparing the size in units of the position being hedged with the size in units of the futures contract
• B) Comparing the value of the position being hedged with the value of one futures contract
• C) Comparing the futures price of the asset being hedged to its forward price
• D) None of the above

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Definitions:

Budget

An itemized summary of estimated or intended expenditures and revenues for a given period, often used by governments, businesses, and individuals to manage finances.

Impoundment Control Act

A 1974 United States federal law designed to restrict the president's ability to withhold funds that have been appropriated by Congress.

Legislative Authority

The power or right to enact laws, typically vested in a legislative body such as a parliament or congress.

Iron Triangles

Iron Triangles describe the stable, mutual relationships among regulatory agencies, interest groups, and legislative committees, leading to the implementation and perpetuation of specific policies and government actions.