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CIPS Exam L4M4 Topic 3 Question 17 Discussion

Actual exam question for CIPS's L4M4 exam
Question #: 17
Topic #: 3
[All L4M4 Questions]

For what type of purchase would you use a Futures Exchange?

Show Suggested Answer Hide Answer
Suggested Answer: C

The correct answer is 'no- quoting in the supplier's currency increases the risk for the buyer'. This questions comes up in a variety of formats in the exam. Remember; if the price is in your own currency (most examples in the exam are given in ) there is less risk than if the prices are quoted in a foreign currency. This is because exchange rates fluctuate; if the price is in you always know what you're paying, if it's in another currency the price can change daily depending on if the exchange rate compared to has gone up or down.


by Tuyet at Aug 06, 2024, 05:35 AM

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King
1 months ago
Futures exchanges? More like Futures Guesses if you ask me. I'll take a wild stab at C) Commodity.
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Vincent
1 months ago
I heard a trader once tried to futures contract a unicorn. Needless to say, it didn't end well.
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Janessa
9 days ago
C) Commodity
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Galen
13 days ago
B) Capital Expenditure
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Michel
16 days ago
A) Tail Spend
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Dorothy
2 months ago
B) Capital Expenditure? Are you kidding me? Futures are all about speculating on commodity prices, not buying equipment. C) Commodity is the way to go.
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Micaela
13 days ago
B) Well, I guess there are different ways to utilize Futures Exchange.
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Wilda
15 days ago
D) High value, high risk purchases can also benefit from using Futures Exchange.
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Cordell
1 months ago
C) I agree, investing in commodities can be quite profitable.
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King
1 months ago
A) Tail Spend is also a common use for Futures Exchange.
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Son
2 months ago
A) Tail Spend? Really? Futures exchanges are for big-ticket items, not office supplies. I think I'll go with C) Commodity.
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Lyda
1 months ago
C) Commodity
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Glennis
1 months ago
A) Tail Spend? Really? Futures exchanges are for big-ticket items, not office supplies.
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Glory
2 months ago
I'm going with D) High value, high risk. Futures trading can be pretty risky, so that seems like the most accurate description.
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Billye
2 months ago
Definitely C) Commodity. That's what futures exchanges are all about - trading commodities like wheat, oil, gold, etc.
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Victor
1 months ago
That's true. It's important to do your research and understand the market before getting involved.
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Albina
1 months ago
I've heard it can be quite risky though, especially if you're not careful with your investments.
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Daron
1 months ago
Yes, you're right. It's a way to hedge against price fluctuations in those commodities.
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Ligia
1 months ago
C) Commodity. That's what futures exchanges are all about - trading commodities like wheat, oil, gold, etc.
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Ocie
3 months ago
I believe Futures Exchange is not suitable for tail spend or capital expenditure.
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Remedios
3 months ago
I agree with Rodolfo, Futures Exchange is commonly used for commodities.
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Rodolfo
3 months ago
I think you would use a Futures Exchange for commodities.
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