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The ntocess of enterprise risk management relles an a variety of activities and instruments charocterized by specifs and often confusing meanings. To ensure that the
The ntocess of enterprise risk management relles an a variety of activities and instruments charocterized by specifs and often confusing meanings. To ensure that the meaning of these terms are clear in your mind, match the terms relating to the basic terminology and concepts associated with the process of enterprise nisk management on the left with the descriptions of the termis on the right. Read all descriptions firstand then make the best match between each description and term. Choose the letter of the description in the Answer. column next to the correct term. (Note: These are not necessarily complefe-definitions, but there is only one possible answer for each term.) Natural hedge G. This process is undertaken by an organization's board of directors, management, and other personnel to identify potential events that could affect the organization in achieving Its objectives, Asymmetric hedge 11. This phenomenon occurs when the gain or loss on a hedged transaction exactly offsets the loss or gain on the untiedged position. Long thedge I. In this transaction, o business or individual invests in two different assets or cash flow generating activities, and the cash flows produced by the assets are mirror images of one another. As a result of this transaction, the risk associated with one asset can be reduced. or exactly offset by the second asset. forward contract 3. This financial transaction requires two parties to exchange one another's cash payment. obligations
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