If the Producer of a Product Has Entered into a Fixed

question 50

Multiple Choice

If the producer of a product has entered into a fixed price sale agreement for that output, the producer faces:

• A)a nice steady profit because the output price is fixed.
• B)an uncertain profit if the input prices are volatile.This risk can be reduced by a short hedge.
• C)an uncertain profit if the input prices are volatile.This risk can be reduced by a long hedge.
• D)a modest profit if the input prices are stable.This risk can be reduced by a long hedge.
• E)a modest profit if the input prices are stable.This risk can be reduced by a short hedge.

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Definitions:

Auditory Rhythm

Temporal patterns in sound that are perceived by the auditory system, important in music and speech processing.

Reversible Figure

A visual pattern that easily allows more than one interpretation, in some cases changing the specification of figure and ground, in other cases changing the perceived organization in depth.

Lighter

A portable device used to generate a flame for the purpose of lighting something, such as a cigarette or candle.

Darker

Having very little light, not bright, or closer to black in color.