A Long Hedge Is a Simultaneous ________ Position in the Spot

question 14

Multiple Choice

A long hedge is a simultaneous ________ position in the spot market and a ________ position in the futures market.

• A) long; long
• B) long; short
• C) short; long
• D) short; short

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Definitions:

Human Fraud

Intentional trickery by members of an organization aimed at obtaining an unethical or illegal advantage.

Cost-Benefit Principle

An economic principle that compares the cost of an action to its benefits. The action is considered favorable if the benefits outweigh the costs.

Collusion

An agreement, usually secretive, between two or more parties to limit open competition by deceiving or defrauding others of their legal rights, or to obtain an objective forbidden by law, typically involving fraud or gaining an unfair market advantage.

Establishing Responsibilities

A principle of internal control that aims to clearly define roles and duties within an organization to ensure accountability and efficient operations.