Strategic Planning & Analysis Flashcards
7 cards from real Series 3 – The National Commodities Futures Test practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Strategic Planning & Analysis flashcards as text
A USDA report shows the projected ending stocks-to-use ratio for corn falling sharply from last year. What is the most likely fundamental implication?
Answer: Bullish, because available supplies are shrinking relative to usage
A falling stocks-to-use ratio signals tighter supply relative to demand, which is generally bullish for price.
A market in contango with futures prices well above spot most directly reflects which condition?
Answer: Ample supply and carrying charges built into deferred prices
Contango means deferred futures trade above spot, typically reflecting ample supply and the cost of carry.
A market is at full carry. The difference between the deferred futures price and the spot price equals which of the following?
Answer: The total cost of storage, insurance, and interest
Full carry means the futures-spot spread equals total carrying costs: storage, insurance, and financing.
A soybean processor wants to lock in its gross processing margin. Which position replicates the board crush hedge?
Answer: Buy soybean futures, sell soybean meal and soybean oil futures
A processor buys the raw input (soybeans) and sells the outputs (meal and oil) to lock in the crush margin.
A jet fuel buyer hedges using heating oil futures because no jet fuel contract exists. What type of hedge is this?
Answer: A cross hedge
A cross hedge uses a futures contract on a related but different commodity than the one being hedged.
The basis for corn moves from -$0.25 to -$0.10. How is this described?
Answer: Strengthening basis
Basis (cash minus futures) becoming less negative is a strengthening basis.
If demand for a commodity is highly elastic, a price increase will most likely cause what?
Answer: A larger percentage drop in quantity demanded
Elastic demand means quantity demanded changes by a greater percentage than price.
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Sources & references
Exam facts on this page (fees, format, dates, passing scores) are checked against these official sources; the date is our last check. Editorial policy
- finra.org — Score release, test dates, test delivery, fees, exam format, passing score · verified Oct 2026
- nfa.futures.org — Eligibility, score validity · verified Oct 2026