8

1.Find the most suitable word for each blank.

_____ traders, whose commitments to supply exceed stock holdings (or who do not hold stocks, but have established a contract to supply), are said to have a _____ position in the physical market.

2.A commodity is a product that is undifferentiated by the supplier.

True

False

3.Net position is NOT the difference between the long and short positions and indicates market exposure.

True

False

4.risk transfer is the strategy of transferring risk to a risk bearer (one who is prepared to accept the risk)

True

False

5.Drag the right word into each blank.

A merchant is a trader who (physical, possession, fee) title and possession of the commodity and can be either a buyer or a seller. An agent does not take physical title but may (physical, possession, fee) on behalf of a client for a commission or (physical, possession, fee).

6.Find the most suitable word for each blank

Position refers to a commitment in the market, either _____ or _____ .

7.Find the most suitable word for each blank.

The Ward and Bowdens five steps to risk management are as follows:

a- _____ the risk environment

b-Identify the risks involved

c-Analyse their implications

d- _____ market alternatives

e-Select the most advantageous approach.

8.Find the most suitable word for each blank.

Price risk management does not result in the ______ price. Nor does it guarantee profitable outcomes. What it does is to manage price at an ______ level given the market conditions at that particular time.