A Miller Who Needs Wheat to Mill to Flour Uses

Multiple Choice

A miller who needs wheat to mill to flour uses the futures market to protect a profit by:

A) a long hedge to take delivery.
B) a short hedge to deliver.
C) buying futures to guard against a potential loss.
D) Both a long hedge to take delivery; and buying futures to guard against a potential loss.
E) Both a short hedge to deliver; and buying futures to guard against a potential loss.