The Risk That the Firm Will Not Have,or Be Able

question 12

Multiple Choice

The risk that the firm will not have,or be able to raise,the cash required to meet the margin calls on its hedges is called:

• A)liquidity risk.
• B)basis risk.
• C)commodity price risk.
• D)speculation risk.

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Definitions:

External Suppliers

Companies or individuals who provide products or services to another company but are not part of that company.

Authorize Buyers

The process of giving approval or permission to purchasers to conduct transactions, often within specific guidelines or limits.

Extranet

A private network that uses Internet protocols, network connectivity, and possibly the public telecommunication system to share a part of an organization's information or operations with suppliers, vendors, partners, customers, or other businesses.

Private Internet

A network established within an organization or between specific entities that uses internet protocols but is restricted to authorized users.