When Comparing REA Diagrams Used to Design an AIS with a Traditionally

question 82

Multiple Choice

When comparing REA diagrams used to design an AIS with a traditionally designed AIS,

• A)traditional AIS information,such as journals and ledgers no longer exist.
• B)similar information is present as in a traditional AIS,but stored in a different format.
• C)queries are used to input data into the AIS.
• D)an REA designed AIS cannot recreate a traditional journal.

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Definitions:

Hedge Ratio

The Hedge Ratio is a risk management tool that compares the value of a position protected through a hedge to the size of the entire position.

Long Put Option

A financial derivative strategy that gives the holder the right, but not the obligation, to sell a specific amount of an underlying asset at a predetermined price within a specified timeframe.

Binomial Option Model

A mathematical model used to price options by breaking down the time to expiration into potentially infinite segments or steps.

Subintervals

Divisions within a larger interval, often used in mathematics to partition an interval into smaller segments.