A manufacturer of breakfast cereals should always be fully hedged against both rising and falling grain prices.

Name: A manufacturer of breakfast cereals should always be fully hedged against both rising and falling grain prices.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

While hedging can protect against price volatility, being fully hedged against both rising and falling prices can limit a manufacturer's ability to benefit from favorable price movements and may not always align with a company's risk management strategy or financial goals.

A Manufacturer of Breakfast Cereals Should Always Be Fully Hedged