If You Use Futures Prices to Estimate the Cash Flows

question 65

Multiple Choice

If you use futures prices to estimate the cash flows from commodity production, the estimates are
I.present values of future cash flows
II.certainty equivalents;
III.same as the estimates using spot prices

• A)I only
• B)II only
• C)III only
• D)I and III only

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Definitions:

Randomized Block Design ANOVA

A statistical method used to analyze the variability among experimental conditions while controlling for variance due to specified blocking factors.

Dependent Samples T-test

A statistical test used to compare the means of two related groups to determine if there is a statistically significant difference between them.

Two-way ANOVA

A statistical method used to examine the influence of two different categorical independent variables on one continuous dependent variable.

Degrees of Freedom

The total count of distinct values or elements that may be given to a statistical distribution.