Was MGRM's decision to use stack-and-roll hedges the reason for its colossal losses? What risks cannot be hedged with stack-and-roll hedges?
What will be an ideal response?
The stack-and-roll hedge is a technically sound way to hedge commodity price risk. The hedger is still confronted with basis risk (i.e., the risk of a change in the difference between the spot price and the futures price), but this risk is usually less than spot price risk. If the position being hedged is massive enough, changes in basis can cause sizeable cash outflows.
Stack-and-roll hedges protect annual income statements when hedge accounting is permitted. If the company has to use lower-of-cost-or-market accounting, the annual income statement is not protected by stack-and-roll hedges. Stack-and-roll hedges do no protect against credit risk.
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Which motivation theory is criticized for its assumption that people pursue needs in a step-by-step sequence?
A. Maslow’s hierarchy of needs B. Alderfer’s ERG theory C. Herzberg’s two-factor theory D. McClelland’s acquired needs theory
A restaurant decides to offer a lunch buffet instead of a la carte ordering. Which of the following is not a co-production benefit of the restaurant’s decision?
a. Increase in cost efficiency from being able to serve more customers without needing more waitstaff b. Increase in guests’ perceived control since they can choose their favorite foods in their preferred quantities from the buffet c. Increase in production efficiency from utilizing a kitchen that might otherwise be more idle d. Increase in inventory efficiency from minimizing food waste
The total profit resulting from the business relationship with a customer over the course of
his/her life is known as the ________. A) customer lifetime value B) customer value proposition C) upside potential ratio D) average propensity to consume
Can conflict be managed to promote organizational performance, if so how?
What will be an ideal response?