Hedging risk for a long position is accomplished by
A) taking another long position.
B) taking a short position.
C) taking additional long and short positions in equal amounts.
D) taking a neutral position.
B
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A major difference between the costs of unemployment and the costs of inflation is that
A) the former is structural the latter frictional. B) the government pays the latter, the population pays the former. C) unemployment costs are concentrated among a few people, while inflation costs are distributed more broadly across the entire population. D) unemployment costs are distributed among people, while inflation costs are distributed more narrowly across the entire population.
Compared to a proprietorship, a disadvantage of a partnership is
A) that profits are taxed twice. B) that it is harder to keep the firm going after the death of an owner. C) unlimited liability. D) that potential liability to each partner is greater.