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IIA Exam IIA-CFSA Topic 7 Question 58 Discussion

Actual exam question for IIA's IIA-CFSA exam
Question #: 58
Topic #: 7
[All IIA-CFSA Questions]

End users need to hedge the prices at which they can purchase these commodities for instance:

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Suggested Answer: D

by Elliot at Aug 08, 2024, 05:58 AM

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Shala
10 months ago
Yes, locking in prices for essential commodities like electricity and jet fuel can help businesses budget effectively.
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Latricia
10 months ago
I believe option D is the correct answer because both A and B involve hedging price risks.
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Doug
10 months ago
I agree, it's important for businesses to protect themselves from price fluctuations.
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Stevie
10 months ago
I think end users should hedge their prices to manage risk.
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Micah
10 months ago
Yes, locking in prices for essential commodities like electricity and jet fuel can help businesses budget effectively.
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Elenore
11 months ago
I believe option D is the correct answer because both A and B involve hedging price risks.
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Trevor
11 months ago
I agree, it's important for businesses to protect themselves from price fluctuations.
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Denise
11 months ago
I think end users should hedge their prices to manage risk.
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Wenona
11 months ago
Ha! Reminds me of the time I tried to hedge my bets on a horse race. Ended up losing my shirt. But in all seriousness, I think C is the way to go here.
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Arthur
11 months ago
I agree with Pearline. C covers all the bases - universities, airlines, and producers all need to hedge their exposure to commodity price fluctuations.
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Oretha
12 months ago
Hmm, I'm not sure about that. I was leaning towards D, since the question specifically asks for 'these commodities', and the first two options seem more directly related to commodities like electricity and jet fuel.
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Avery
11 months ago
Yeah, I agree. A and B are the only options related to commodities like electricity and jet fuel.
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Pamela
11 months ago
I think you're right, D does seem to be the best choice here.
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Pearline
12 months ago
I think the correct answer is C. Hedging applies to all the scenarios mentioned - a university locking in electricity prices, an airline locking in jet fuel prices, and a cotton producer hedging against changes in fertilizer or cotton prices.
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Refugia
11 months ago
Oh, I see. Thanks for clarifying that. It makes sense now why the correct answer is D. Hedging is more about locking in prices for future purchases to manage risk.
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Justine
11 months ago
Actually, the correct answer is D. Only A and B are examples of hedging. The cotton producer scenario involves managing exposure to price changes, but it's not a form of hedging.
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Glynda
11 months ago
I think the correct answer is C. Hedging applies to all the scenarios mentioned - a university locking in electricity prices, an airline locking in jet fuel prices, and a cotton producer hedging against changes in fertilizer or cotton prices.
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