When Firms Use Futures Contracts for Hedging,cash Flows Are Received

question 106

Multiple Choice

When firms use futures contracts for hedging,cash flows are received and paid daily rather than waiting until the end of the contract through a procedure called:

• A)cash flow hedging.
• B)marking to market.
• C)swaps.
• D)put-call parity.
• E)daily settlement.

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