Hedging One Commodity by Using a Futures Contract on Another

question 23

Multiple Choice

Hedging one commodity by using a futures contract on another commodity is called

• A) surrogate hedging.
• B) cross hedging.
• C) alternative hedging.
• D) correlative hedging.
• E) proxy hedging.

---

Definitions:

Exocytosis

The process by which a cell transports secretory products through the cytoplasm to the plasma membrane and then into the extracellular environment.

Action Potential

A rapid change in electrical potential across the membrane of a nerve or muscle cell when it is stimulated, leading to transmission of an electrical impulse.

Gap Junctions

Specialized intercellular connections that allow for the direct transfer of ions and molecules between neighboring cells, facilitating communication and coordination of activity.

Electrical Synapses

A type of synapse in which electrical currents flow directly from one cell to another via gap junctions, facilitating rapid communication.