A ____ Is Not Normally Used for Hedging Long-Term Transaction

question 40

Multiple Choice

A ____ is not normally used for hedging long-term transaction exposure.

• A) long-term forward contact
• B) futures contract
• C) currency swap
• D) parallel loan

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Definitions:

Supply Falls

A situation where the quantity of goods or services available decreases in relation to demand.

Price Floor

A government- or group-imposed price control or limit on how low a price can be charged for a product.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, leading to market equilibrium.

Surplus

The situation in which the quantity supplied of a good exceeds the quantity demanded at a given price.