This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Today is January 1st. You are a soybean farmer that wants to hedge the price of your current crop. ... (Read 136 times)

Engineer

  • Hero Member
  • *****
  • Posts: 527
on: Apr 25, 2021
Today is January 1st. You are a soybean farmer that wants to hedge the price of your current crop. Soybean futures contracts trade on the CME, and call for the delivery of 5,000 bushels of soybeans. Your soybeans will be ready for market in September, and you expect to harvest 75,000 bushels. Assume you enter the appropriate futures position to hedge your price risk at a futures price of $7.70/bu. In the fall you sell your soybeans locally at the current spot price of $7.4275, and also execute an offset trade. Due to convergence, the futures price is equal to the prevailing spot price. What are your total proceeds from selling your soybeans? Total proceeds include the profits (loss) from the futures transactions.
◦ $536,625
◦ $558,425
◦ $577,500
◦ $595,375
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
Buy Test-Bank


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by Engineer on Apr 25, 2021

ashely1112

  • Sr. Member
  • ****
  • Posts: 347
Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
Answer Preview
Only 29% of students answer this correctly


Engineer

  • Member
  • Posts: 527
Reply 2 on: Apr 25, 2021
Excellent

Mochi

  • Member
  • Posts: 300
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

All adverse reactions are commonly charted in red ink in the patient's record and usually are noted on the front of the chart. Failure to follow correct documentation procedures may result in malpractice lawsuits.

Did you know?

Medications that are definitely not safe to take when breastfeeding include radioactive drugs, antimetabolites, some cancer (chemotherapy) agents, bromocriptine, ergotamine, methotrexate, and cyclosporine.

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

Did you know?

When taking monoamine oxidase inhibitors, people should avoid a variety of foods, which include alcoholic beverages, bean curd, broad (fava) bean pods, cheese, fish, ginseng, protein extracts, meat, sauerkraut, shrimp paste, soups, and yeast.

Did you know?

Excessive alcohol use costs the country approximately $235 billion every year.

North Atlantic Current North Atlantic Current
Major U.S. Centers of Cattle, Corn, Wheat, and Soybean Production Major U.S. Centers of Cattle, Corn, Wheat, and Soybean Production
The net price of an article is $79.84. What is the list price if a discount of 23% was allowed? The net price of an article is $79.84. What is the list price if a discount of 23% was allowed?
A car wash reduced the price of a basic wash as a promotion and test of the market. With the ... A car wash reduced the price of a basic wash as a promotion and test of the market. With the ...
Magnetic Force on a Current Carrying Conductor Magnetic Force on a Current Carrying Conductor
I NEED IT FOR TODAY PLEASE 14 QUESTIONS I NEED IT FOR TODAY PLEASE 14 QUESTIONS
Video: Osmosis - water transport

For a complete list of videos, visit our video library