A corn-chip maker who buys September corn futures in May at the time she signs a contract with Safeway to deliver 1000 cases of corn chips each month for the next year is
A) competing against speculators, who profit from price fluctuations.
B) increasing her risk from price fluctuations.
C) reducing her risk from price fluctuations.
D) reducing or increasing her risk from price fluctuations, depending on what subsequently happens to the price of corn.
C
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Diminishing marginal utility of wealth leads to risk aversion because at a given level of wealth a dollar gained
A) is worth more in additional utility than a dollar lost. B) is worth less in additional utility than a dollar lost. C) is worth as much in additional utility as a dollar lost. D) does not add to total utility.
All of the following are surplus items on the balance of payments accounts EXCEPT
A) U.S. residents purchases of gold from foreign residents. B) foreign tourists spending funds in the United States. C) exports of merchandise. D) sales of U.S. dollars to foreign residents.
Which of the following is false?
A. The classical economists believed that the economy was basically stable. B. Keynes believed that full employment was a "rare occurrence". C. Keynes argued that the interest rate was the most important factor in determining the level of investment demand in an economy. D. The classical economists used the laws of supply and demand to prove the validity of Say's law.
If one day it was discovered that lime juice caused cancer, which of the following would likely result?
A. The demand curve for lime juice would shift to the right. B. The demand curve for lime juice would shift to the left. C. The supply curve for lime juice would shift to the right. D. The supply curve for lime juice would shift to the left.