Which of the Following Is NOT True Regarding Hedge Ratio

question 59

Multiple Choice

Which of the following is NOT true regarding hedge ratio?

• A)When there is no basis risk hedge ratio is equal to one.
• B)When h = 1, both spot and futures are expected to change together by the same absolute amount.
• C)When h = 1, FX risk of the cash position should be hedged dollar for dollar by buying FX futures.
• D)When basis risk is present, the spot and future exchange rates are expected to move imperfectly together.
• E)The FI must sell a greater number of futures when there is basis risk than it has to when basis risk is absent.

Understand the psychological factors driving the need to belong.

Examine the expectation and hypersensitivity to rejection.

Explore the concept of loneliness and the human need for connection.

Analyze group dynamics in the context of forming and ending relationships.

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Definitions:

Psychosocial Factors

Influences on psychological development that are derived from societal, cultural, and interpersonal processes.

Episodes

Occurrences or periods in which symptoms of a condition become noticeable or significantly intensified.

Stress

The body's response to any demand or challenge, which can be triggered by both positive and negative experiences.

Neuroleptics

A class of medications primarily used to manage psychosis, particularly in schizophrenia and bipolar disorder, also known as antipsychotic drugs.