A purchaser of commodities who is completely hedged with forward contracts has eliminated the risk that prices will rise before the purchase is concluded.

Name: A purchaser of commodities who is completely hedged with forward contracts has eliminated the risk that prices will rise before the purchase is concluded.
Brand: Quizplus
Rating: 4.9 (48 reviews)

Question

Quizplus · Accepted Answer

By entering into forward contracts, the purchaser is able to lock in purchase prices, eliminating the risk of price increases before the purchase is concluded.

A Purchaser of Commodities Who Is Completely Hedged with Forward