Business Continuity Professional Exam Prep

Answer: c - Protecting against fluctuating exchange rates and buying oil futures could be hedging against business risk. This is a potential strategy to mitigate risk a business continuity planner can recommend.

Key Takeaway: Hedging is important to smoothing earnings and ensuring consistent cash flow. For instance, Southwest Airlines has protected itself by purchasing contracting for jet fuel at a set price to protect against fluctuating prices.