22-117 Assume That the Hedge Was Placed at the Rates

question 52

Multiple Choice

22-117 Assume that the hedge was placed at the rates in question 114,and that the BP futures contract is trading at $1.62/£.Assume the futures contract has some days remaining to maturity.What will be the gain or loss on the hedge if it is unwound at this price?

• A)$4,280,000 loss.
• B)$4,000,000 loss.
• C)$4,280,000 gain.
• D)$4,000,000 gain.
• E)$6,400,000 gain.

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Definitions:

Self-Serving Attributional Bias

The common tendency to attribute one’s successes to personal characteristics and failures to external factors.

Self-Handicapping

A strategy where individuals create obstacles for themselves to provide an excuse for potential failure, thereby protecting self-esteem.

God's Love

The unconditional and infinite love that God holds for His creations, as interpreted in various religious contexts.

Symbolic Self-Completion

A theory suggesting individuals strive to acquire and display symbols that are associated with their desired self-identity, especially when they feel incomplete in a certain role or aspect.