If You Have a Long Position in a Foreign Currency

question 34

Multiple Choice

If you have a long position in a foreign currency, you can hedge with:

• A)A short position in an exchange-traded futures option
• B)A short position in a currency forward contract
• C)A short position in foreign currency warrants
• D)Borrowing (not lending) in the domestic and foreign money markets

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Definitions:

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A Russian economist best known for proposing the theory of long economic cycles, or "Kondratiev waves," which suggest that capitalist economies experience long-term cycles of boom and bust.

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