A Firm Can Hedge the Risk of Upward Movement in Raw

question 75

Multiple Choice

A firm can hedge the risk of upward movement in raw material prices by taking one of the following positions.

• A)Buying a call option
• B)Selling a put option
• C)Buying a put option
• D)Selling a futures contract

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Definitions:

Phylogenies

The study and construction of family trees that show the evolutionary relationships among various biological species or other entities.

Traditional Animal

A term that might refer to species commonly recognized or domesticated by human cultures throughout history, but without a precise scientific meaning.

Fossil Record

The collection of fossils that has been discovered, providing evidence about the history of life on Earth.

Structural Protein

Proteins that play a role in building and maintaining the shape and structure of cells and tissues, such as collagen in connective tissues.