Question: Commodity brokers use forward and futures contracts for which reason? Responses The riskiness of commodity production means that many commodity producers go bankrupt before harvest

Commodity brokers use forward and futures contracts for which reason? Responses The riskiness of commodity production means that many commodity producers go bankrupt before harvest time. The riskiness of commodity production means that many commodity producers go bankrupt before harvest time. The seasonal nature of many commodities would lead to wide variations in supply and price without these contracts. The seasonal nature of many commodities would lead to wide variations in supply and price without these contracts. The raw, unprocessed nature of commodities means that there is always a third party to any commodity-purchase contract. The raw, unprocessed nature of commodities means that there is always a third party to any commodity-purchase contract. Commodities come from many different countries with very different currency exchange rates

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!