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Author Question: Today is January 1st. You are a soybean farmer that wants to hedge the price of your current crop. ... (Read 151 times)

Engineer

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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
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Marked as best answer by Engineer on Apr 25, 2021

ashely1112

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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.
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Engineer

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Reply 2 on: Apr 25, 2021
Great answer, keep it coming :)

laurnthompson

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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