Which of the following strategies is used to deal with uncertainty related to price risk?
A)Statistical analysis
B)Cost restructuring
C)Hedging
D)Insurance

Question

Quizplus · Accepted Answer

Hedging is a strategy used to deal with uncertainty related to price risk. Hedging involves taking a position in a financial market that is opposite to the position taken in the underlying asset. This can help to offset potential losses if the price of the underlying asset moves against the original position. Statistical analysis may provide information about price trends, but it does not directly address price risk. Cost restructuring might help to manage costs, but it does not eliminate the uncertainty of price movements. Insurance is typically used to manage risk related to unexpected events, such as accidents or theft, rather than price risk.

Which of the Following Strategies Is Used to Deal with Uncertainty