Economist Paul Heyne Looked in the Newspaper and Found That

question 11

Multiple Choice

Economist Paul Heyne looked in the newspaper and found that in December of 1991 the price of wheat was $4.05 a bushel. The futures price for March 1992 was $3.87, the May price $3.64, the July price $3.33, September was $3.31, and the futures price for the following December was $3.51. What is the implication of these price trends?

• A) Buying wheat futures was a pretty bad deal.
• B) Speculators were forecasting increased scarcity of wheat.
• C) Speculators were not forecasting increased scarcity of wheat.
• D) Selling wheat futures was a pretty bad deal.

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Definitions:

Beginning Of The Year

Refers to the start of a fiscal or calendar year, marking the point in time when businesses commonly review and adjust budgets, plans, and strategies.

Investing Activities

Financial transactions involving the purchase and sale of long-term assets and other investments not included in cash equivalents.

Statement Of Cash Flows

A report detailing how variations in income and balance sheet figures influence cash and cash equivalents.

Retirement Of Bonds Payable

The process of paying off issued bond debt before its maturity date, removing the bonds from circulation.