An Individual Who Neither Uses nor Produces a Commodity but Buys

question 29

Multiple Choice

An individual who neither uses nor produces a commodity but buys a futures contract for the asset is:

• A)Speculating that the price of the commodity is going to fall.
• B)Speculating that the price of the commodity is going to increase.
• C)Is using arbitrage to earn profits without taking a risk.
• D)Is hedging and transferring risk.

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Definitions:

Realistic Goal

A goal that is achievable and can be reasonably attained, taking into consideration current resources and constraints.

Self-confidence

Involves having trust in one's capability to tackle challenges, make decisions, and assert oneself effectively in various situations.

Actual Experience

Denotes direct, personal involvement or encounter with events or activities, as opposed to theoretical knowledge.

Negative Self-talk

Refers to the inner dialogue that criticizes or demeans oneself, often leading to decreased motivation and self-esteem.