Question: Which entities are hedging long? Statement 1: A bread producer enters into a 6-month forward contract to secure the purchase of wheat. Statement 2: A

Which entities are hedging long? Statement 1: A bread producer enters

Which entities are hedging long?

Statement 1: A bread producer enters into a 6-month forward contract to secure the purchase of wheat. Statement 2: A New Zealand firm, which expects to receive its sales revenue of USD 1 million from oversea clients in three months, signs a 3-month FEC on the NZD/USD exchange rate today. Statement 3: A corporation, which will take a 3-month floating rate loan from the local bank in two months, enters into a 25 FRA contract as the pay-fix-receive-floating party. Statement 4: An airline goes long a 9-month futures contract on crude oil to cross-hedge the price risk of jet fuel. Which of the above statements are examples of long hedgers? Statements 1,3 , and 4 only Statements 1 and 4 only All of the statements. Statements 1,2 , and 4 only

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