The position which came in to existence because of holding assets more than liabilities is considered as _____________?
Correct answer: A. net long in currency
- A. net long in currency
- B. net short in currency
- C. net surplus in assets
- D. net surplus in liabilities
Explanation
When assets denominated in a currency exceed liabilities in that currency, the institution has a net long position. A long position benefits from an appreciation of that currency, while excess liabilities create a short position.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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