Why do investors hedge using futures contracts?

Why do investors hedge using futures contracts?
 
  A) they are seeking to increase liquidity
  B) they are willing to pay for a reduction in risk
  C) in order to provide a counterparty to speculators
  D) they are more flexible than forward contracts

Question 2

Refer to Figure 11.2. Assume the economy is in equilibrium at 1, where real GDP equals potential GDP, and then the economy experiences a positive demand shock. Other things equal, the positive demand shock is best represented by a(n)
 
  A) movement up along the Phillips curve.
  B) movement down along the Phillips curve.
  C) upward shift of the Phillips curve.
  D) downward shift of the Phillips curve.