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Perminder Ltd

Question 25

Multiple Choice

Perminder Ltd. buys raw (green) coffee beans, roasts, packages and distributes premium coffee nationally. Green bean prices, like oil, currency and gold, are set on international markets. Which of the following does Perminder Ltd. face?


A) Non-diversifiable risk that can be reduced by purchasing long-term future contracts.
B) Non-diversifiable risk that can be reduced through changes in processing or investment.
C) Diversifiable risk that can be reduced by purchasing green beans from different growers or different countries.
D) Diversifiable risk that can be reduced by purchasing long term future contracts.
E) Diversifiable risk that can be reduced through changes in processing or investment strategy.

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