Which of the following statements about hedging of business risks by investors is (are) correct?
I. Operational information about companies is widely available and investors find it relatively simple to hedge business risk.
II. Investors have the necessary capital required to implement hedging strategies and do so consistently.
A) Only statement I is correct.
B) Only statement II is correct.
C) Both statements I and II are correct.
D) Neither statement I nor II is correct.

Question

Which of the following statements about hedging of business risks by investors is (are) correct?
 I. Operational information about companies is widely available and investors find it relatively simple to hedge business risk.
II. Investors have the necessary capital required to implement hedging strategies and do so consistently.
A) Only statement I is correct.
B) Only statement II is correct.
C) Both statements I and II are correct.
D) Neither statement I nor II is correct.

Quizplus · Accepted Answer

Operational information about companies may not always be widely available or simple to interpret, making it challenging for investors to hedge business risk effectively. Additionally, not all investors have the necessary capital or choose to implement hedging strategies consistently, as these strategies can be complex and costly.

Which of the Following Statements About Hedging of Business Risks