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Which one of the following statements regarding basis is true? 1) The basis is the difference between the futures price and the spot price. 11)

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Which one of the following statements regarding "basis" is true? 1) The basis is the difference between the futures price and the spot price. 11) The basis risk is borne by the hedger. III) A short hedger suffers losses when the basis decreases. IV) The basis increases when the futures price increases by more than the spot price. IV only I, II, and IV. III only II only I only Interest rate futures contracts exist for all of the following except repurchase agreements banker's acceptances federal funds Eurodollars

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