Which of the Following Players Would Require a Put Option

question 3

Multiple Choice

Which of the following players would require a put option in order to hedge their natural position in the market?

• A)A farmer who buys corn to feed his livestock
• B)A farmer who sells peanuts to a chocolatier
• C)A farmer who has financed his land with a floating rate mortgage
• D)A miller who buys wheat from a farmer

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Definitions:

Statistically Significant

A term used to describe a result that is unlikely to have occurred by chance, indicating a meaningful difference or relationship in data.

Researchers

Individuals who conduct systematic investigation into and study of materials and sources in order to establish facts and reach new conclusions.

Population

The total number of people inhabiting a specific area or the whole planet, characterized by factors such as density, distribution, and growth rate.

Participant Observation

A methodological approach in social research where the observer seeks to gain a close and intimate familiarity with a given group of individuals and their practices through an intensive involvement with people in their natural environment, often over an extended period of time.