A Business Owner Starts a New Business and Invests $6,000

question 54

True/False

A business owner starts a new business and invests $6,000 of capital.This transaction results in an increase in the business's liabilities.

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Definitions:

Hedge Ratio

The hedge ratio is a financial ratio that compares the value of a position protected through hedging with the size of the entire position itself.

Futures Position

A contractual agreement to buy or sell a particular commodity or financial instrument at a predetermined price at a specified time in the future.

Exchange Rate

The value of one currency for the purpose of conversion to another, determining how much of one currency can be exchanged for another.

Portfolio's Beta

A measure of the volatility, or systemic risk, of a portfolio in comparison to the market as a whole.