Which of the following statement is TRUE about hedge? ...
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Accounting
Which of the following statement is TRUE about hedge?
| A long hedge is appropriate when a company knows it will have to purchase an asset in the future. | ||
| A perfect hedge always succeed in locking in the current spot price of an asset for a future transaction. | ||
| If the minimum-variance hedge ratio is calculated as 1.0, the hedge must be perfect. | ||
| A short hedge can only be used when the company owns the asset and does not know what position it will take in the future. |
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