Hedging with Commodity Futures

question 37

Multiple Choice

Hedging with commodity futures

• A)reduces the risk of loss
• B)results when an investor buys a contract
• C)occurs when the individual takes delivery
• D)is the opposite of selling short

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Definitions:

Vote Trading

An agreement between two or more parties to swap votes on issues of mutual interest, to achieve a desired outcome for both sides.

Efficient

The optimal use of resources to achieve the desired outcome with minimal waste or expense.

Voting Outcome

The result of a voting process, determining which candidates or measures have been selected or rejected based on majority preference.

Majority Vote

A decision rule in which the option that receives more than half of the votes is chosen.