GoTranscript Audio Test Answers 10 August 2022
Speaker 1: This audio is used for the transcriber test at GoTranscript. If I were you, I'd pay attention to the number. Speaker 2: There are two primary reasons to hedge. One is to read reduce your short term cash flow volatility. Another is to maximize return on capital for whatever the investors target level of risk is. Many benefits are achieved if you successfully reduce cashflow volatility, the primary one being that nine times out of 10, the risk of bankruptcy bankruptcy can be reduced, which not only reduces the cost of borrowing but also makes lenders more willing to lend you any money to begin with. Furthermore, more accurate earnings forecasting is possible when hedging a company with more predictable earnings will in general be more valued by investors. If your company uses hedging to withstand short term price movements, its management can then focus their energy more focus more fully on the company's core competencies, doing what they are best at. In 1997, a poll