Forward buying:
A)offsets transactions to protect against price and exchange risks.
B)involves purchasing for known or estimated future requirements.
C)involves no risk for the buying organization.
D)is the same as speculation.
E)seeks to take advantage of price movements.

Question

Quizplus · Accepted Answer

Forward buying involves purchasing for known or estimated future requirements, such as buying raw materials or supplies for production. It is a way for organizations to ensure they have the necessary inputs for their operations while also potentially locking in a favorable price. It does involve some degree of risk, as future prices and exchange rates may differ from what was anticipated, but the goal is not to speculate or take advantage of price movements.

Forward Buying