Q602
Indicate the incorrect statement (i) Credit risk is a loss on account of a default of repayment of a loan. (ii) Liquidity risk is the risk on account of the mismatches of cash inflow and outflow in a firm. (iii) Basic risk is the risk in a firm owing to the differences in the index to which financial assets and liabilities are tied up. (iv) Hedging risk for a long position is accomplished by taking a short position and vice versa.
A.
(i) and (ii)
B.
(ii) and (iii)
C.
(iii) and (iv)
D.
All of the above
AnswerAnswer: Option D
Solution
Answer: Option D
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