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A wheat grower expects to have 40000 bushels of wheat to

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A wheat grower expects to have 40,000 bushels of wheat to sell in three months. The wheat futures contract on the Chicago Board of Trade is 3,000 bushels of wheat.

a. How could the grower use this contract for hedging?

b. What are the advantages and disadvantages of hedging in this situation?

Reference no: EM13618615

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