Which of the Following Statements Is FALSE

question 9

Multiple Choice

Which of the following statements is FALSE?

• A)Firms generally do not possess better information than outside investors regarding the risk of future commodity price changes,nor can they influence that risk through their actions.
• B)Cash flows are exchanged on a monthly basis,rather than waiting until the end of the contract,through a procedure called marking to market.
• C)The firm may speculate by entering into contracts that do not offset its actual risks.
• D)When a firm authorizes managers to trade contracts to hedge,it opens the door to the possibility of speculation.

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Definitions:

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A trailer designed specifically for transporting boats over land, often to and from bodies of water.

Researched Vacation Spots

Destinations identified and evaluated through research for potential holiday or travel experiences.

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The process of searching for and securing a residential unit in a building or complex to live in.

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A geographical area, especially within a city or town, that forms a community of people living close to each other.