Corporate Financial Theory 10 公司财务理论.pptVIP

Hedging Futures Today We will return to Capital Budgeting Financing. We will discuss how to reduce risk. Topics How to eliminate risk in capital budgeting. (i.e. variable costs) How to eliminate risk in financing (i.e. interest rate fluctuations) HOW? By Hedging Futures Contracts Ex - Cereal Production Ex - Kellogg produces cereal. A major component and cost factor is sugar. Forecasted income sales volume is set by using a fixed selling price. Changes in cost can impact these forecasts. To fix your sugar costs, you would ideally like to purchase all your sugar today, since you like