A Firm Wants to Hedge a Potential Transaction but Is

question 34

Multiple Choice

A firm wants to hedge a potential transaction but is also concerned about a possibility that it may not take place. In this case it is better to hedge potential risks using ________.

• A) options
• B) forwards
• C) futures
• D) none of the above

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Definitions:

Integrative Negotiation

A negotiation strategy that aims to create mutually beneficial results by addressing the interests of all parties involved.

Attractive Assignment

A task or project that is appealing to individuals, often because it offers growth opportunities or recognition.

Salary Premium

Additional compensation over the base salary that an employee receives, often due to special skills, performance, or market factors.

New Hires

Individuals who have recently joined an organization, typically undergoing orientation and initial training processes.