Using a simple framework, a typical finance student can gain a clear, intuitive understanding of how risk management can be employed to comply with policy set forth by the firm’s board. A parsimonious risk setting provides a better comprehension of the key risk management concepts over rote learning, and will establish how risk management decisions enter the familiar analytic setting in corporate finance. The exercise demonstrates how the firm chooses a hedge ratio which is compliant with the board’s risk management policy, while using only those tools which the typical finance student has demonstrated facility. The understanding gained during the exercise enables the student to participate in management discussions about project risk and risk management.