Intertemporal Risk Management Decisions of Farmers under Preference, Market, and Policy Dynamics



Figure 8. Sensitivity of Optimal Hedge Ratios in Response to Transaction Cost


Year 1


With CCP


No CCP


Optimal Hedge Ratio


0.4230

0.4225

0.4220

0.4215

0.4210

0.4205

0.4200

0.4195

0.4190


о.


y Yrl (With CCP)


о Yrl (No CCP)


-■Linear (Yrl (With CCP))


Linear (Yrl (No CCP))


•ж


ζ^v Ç?' ζy,                    ςp4 PP Pv1

ÿ’ 'ÿ 'ÿ c, 'ÿ c>, c>,
ç>- ç>- ç>- ç>- ç>- ç>- ç>- ç>- ç>-


<∙∙α.


×    <Γ'⅛4

ж <>■
ж


0.6120

0.6115

0.6110

0.6105

0.6100

0.6095

0.6090

0.6085

0.6080


cΛ- A Λ √⅛ √× √⅛ √b Л A Λ r<V
C?3 ς? ς? ς? ς? ς? ς? ς? ς? ς? .4d
43
ç>- ç>- ç>- ç>- ç>- ç>- ç>- ç>- ç>- 43


Transaction Cost ($)


43




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