When firms use futures contracts for​ hedging, cash flows are received and paid daily rather than waiting until the end of the contract through a procedure​ called:

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when firms use futures contracts for​ hedging, cash flows are received and paid daily rather than waiting until the end of the contract through a procedure called:

Options

A)cash flow hedging. B)marking to market.
C)swaps.
D)put-call parity.
E)daily settlement.

Correct answer is Option B. marking to market. Explanation: when firms use futures contracts for hedging, cash flows are received and paid daily rather than waiting until the end of the contract through a procedure​ called: marking to market.

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