The Risk That Arises Because the Value of the Futures

question 76

Multiple Choice

The risk that arises because the value of the futures contract will not be perfectly correlated with the firm's exposure is called:

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

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Definitions:

Verbal Expression

The ability to convey thoughts, feelings, or information through spoken language, involving a wide range of vocabulary and grammatical structures.

Consonants

Speech sounds produced by obstructing the flow of air at one place or another along the path of the airflow from the vocal folds.

Vowels

Speech sounds produced without any significant constriction or blockage of airflow in the vocal tract.

Visual Recognition Scores

Quantitative assessments used to measure an individual's ability to recognize or identify visual objects, patterns, or symbols.