1. Assume the firm has a downward sloping risk profile with respect to crude oil price (i.e. with crude oil price as the x-axis). Which one of these statements correctly describes the instruments that the firm can use to hedge the risk exposure to crude oil price? A) If the firm takes a long position in a call option on crude oil, it will eliminate both downside risk and upside potential. B) The firm can take a long position in a forward contract whose payoff profile is downward sloping. C) The firm's hedge portfolio can consist of options, swaps and futures D) The firm can take a short position in a forward contract whose payoff profile is upward sloping. E) The firm cannot use futures contracts because futures contracts settle daily