A Farmer Can Reduce the Quantity Risk by Buying a Futures

question 60

True/False

A farmer can reduce the quantity risk by buying a futures contract.

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Definitions:

Mathematical Equation

A statement of equality between two expressions which holds true under certain conditions.

Independent Variable

A variable in an experiment or model that is manipulated to observe its effect on the dependent variable.

Dependent Variable

A variable in experimental and statistical modeling whose value is dependent on the influence of another variable (the independent variable).

Coefficient Of Determination

A statistic that indicates the proportion of the variance in the dependent variable that is predictable from the independent variable(s).