Although it reduces commodity price risk, that strategy is described as not being a perfect:
AHandle
BHedge
CHouse
DHabit
Answer & Solution
Correct answer: B. Hedge
1. Owning a farm removes one exposure.
2. It introduces land ownership risks in its place.
3. So it is not a perfect hedge.
_Source: OpenStax Principles of Finance 2e, Chapter 20, Risk Management and the Financial Manager._
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