22-72 Historical Analysis of Recent Changes in Exchange Rates in Both

question 108

Multiple Choice

22-72 Historical analysis of recent changes in exchange rates in both the spot and futures markets for a given currency reveals that spot rates are thirty percent more sensitive than futures prices.Given this information,the hedge ratio for this currency is

• A)0.70.
• B)0.77.
• C)1.30.
• D)1.43.
• E)1.86.

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Definitions:

Maslow's Hierarchy

A theory in psychology proposed by Abraham Maslow in his 1943 paper "A Theory of Human Motivation," which outlines a five-tier model of human needs, arranged in a hierarchy from basic (physiological) to more complex (self-actualization) needs.

Physiological Need

Fundamental requirements necessary for maintaining life and physical health, such as food, water, air, and shelter.

Leg Wound

An injury or open sore on the leg, which could result from accidents, surgeries, or medical conditions, requiring proper care and treatment.

Social Identity

An individual's sense of who they are based on their group memberships, such as nationality, ethnicity, or religion.