A Wheat Farmer Who Must Purchase His Inputs Now but Will

question 18

Multiple Choice

A wheat farmer who must purchase his inputs now but will sell his wheat at a market price at a future date:

• A) faces a market risk that cannot be offset.
• B) is a good example of what the chapter refers to as a speculator.
• C) would hedge by taking the short position in a wheat futures contract.
• D) would hedge by taking the long position in a wheat futures contract.

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Definitions:

Target Customer Group

A specific subset of the broader market that a business intends to reach and serve, identified by particular characteristics that align with the company's products or services.

Customer Segmentation

The process of dividing a customer base into distinct groups based on common characteristics, to target marketing efforts more effectively.

TAM

Total Addressable Market, which refers to the overall revenue opportunity available or total demand for a product or service within a market.

Major U.S. City

Any large and significant urban center in the United States typically characterized by a substantial population, economic activity, and cultural influence.