Question: Problem 3 . 1 7 . A corn farmer argues I do not use futures contracts for hedging. My real risk is not the price
Problem
A corn farmer argues "I do not use futures contracts for hedging. My real risk is not the price of
corn. It is that my whole crop gets wiped out by the weather. "Discuss this viewpoint. Should the
farmer estimate his or her expected production of corn and hedge to try to lock in a price for
expected production?
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