Question: On March 30, 2015 a farmer decided how much corn he wanted to plant and what he expects to harvest around early October 2015. He
On March 30, 2015 a farmer decided how much corn he wanted to plant and what he expects to harvest around early October 2015. He also decided to be a good business manager and hedge his corn crop against a potential cash price decline. There are four different available months of corn futures contracts and below are the month and price of each: July 2015: $3.66 per bushel September 2015: $3.54 per bushel December 2015: $3.38 per bushel March 2016: $3.51 per bushel The contract month and therefore price used to start the hedge is (Select] (4 Points) This hedge is a [ Select] hedge. (2 Points)
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