Question 33

Question

A manufacturer of power tools is experiencing regular fluctuations in the price of electrical power
which is having a serious impact on the bottom line. Which of the following would be the most
effective risk strategy to reduce the impact of these fluctuations?

Accepted Answer

Use a forward contract for bulk power purchases

Reese G. · Answer

Locking in rates with forward contracts makes sense here. D

Liam · Answer

Its D, clear scenario for forward contract. Nice straightforward question!

IIA IIA-CIA-Part1 Real Exam Questions [October 2026 Update] Quiz

A manufacturer of power tools is experiencing regular fluctuations in the price of electrical power which is having a serious impact on the bottom line. Which of the following would be the most effective risk strategy to reduce the impact of these fluctuations?

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