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In this quiz, you will be making pre-harvest marketing decisions. You will assume it is March 2025 and a corn producer is planning to sell
In this quiz, you will be making pre-harvest marketing decisions. You will assume it is March 2025 and a corn producer is planning to sell 100,000 bushels by December 2025. Note that 100,000 bushels is the quantity he expects to harvest in the fall, so he still does not have the grain (i.e. he cannot be completely sure he will actually harvest 100,000 bushels). Also, the producer has no grain in storage from previous years, so he only needs to worry about selling the crop that he will harvest in the fall. His break-even price is $4.50/bu (i.e. he needs to sell his grain for at least $4.50/bu in order to make a profit) and his expected local basis for December is -$0.40/bu. Marketing decisions and sales You will make marketing decisions for this producer on nine dates between March and December 2025 (March, April, May, and so on until November). In each of these nine dates you will have some information about market conditions and prices, and will have to make two decisions: how many bushels you recommend selling which contract(s) you recommend using (you can use as many contracts as you like)
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Solution Lets get started March 2025 Current price 420bu Recommendation Sell 20000 bushels at 420bu this will help the producer lock in a profit of 42...Get Instant Access to Expert-Tailored Solutions
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