With Regard to Operational Hedging Versus Financial Hedging

question 29

Multiple Choice

With regard to operational hedging versus financial hedging,

• A)operational hedging provides a more stable long-term approach than does financial hedging.
• B)financial hedging, when instituted on a rollover basis, is a superior long-term approach to operational hedging.
• C)since they both have the same goal, stabilizing the firm's cash flows in domestic currency, they are fungible in use.
• D)none of the above

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Definitions:

Economic

Relating to the production, distribution, and consumption of goods and services, and the management of wealth within a society.

Social

Pertaining to society or its organization; relating to human society and how individuals interact and live together in communities.

Codes Of Ethics

A set of principles and rules designed to guide the behavior and decision-making of members within an organization or profession.

Organizational Citizenship

The voluntary behaviors employees display beyond their normal job duties, which contribute to the organization's effectiveness.