5) What is the value (i.e. amount) of the profit/loss on the hedge on a per unit basis (signs matter)? 6) What is the hedged price per ton on this transaction? 7) If the individual didn't hedge, what would have been the price paid/received for the cash commodity on a per unit basis? 3) The individual made the right decision to hedge: Yes or No. 9) What is the net selling (or purchase) price on a per unit basis? The following questions use the table below about hog farmer needing soybean meal. One contract is for 100 short tons. Now Later $290.00/ton $290.50/ton Cash Soybean Мeal Market Futures $279.00/ton $279.50/ton Soybean Мeal Market

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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5) What is the value (i.e. amount) of the profit/loss
on the hedge on a per unit basis (signs matter)?
6) What is the hedged price per ton on this
transaction?
7) If the individual didn't hedge, what would have
been the price paid/received for the cash
commodity on a per unit basis?
8) The individual made the right decision to hedge:
Yes or No.
9) What is the net selling (or purchase) price on a
per unit basis?
The following questions use the table below about a
hog farmer needing soybean meal. One contract is
for 100 short tons.
Now
Later
$290.00/ton
$290.50/ton
Cash
Soybean
Meal
Market
Futures $279.00/ton $279.50/ton
Soybean
Meal
Market
Transcribed Image Text:5) What is the value (i.e. amount) of the profit/loss on the hedge on a per unit basis (signs matter)? 6) What is the hedged price per ton on this transaction? 7) If the individual didn't hedge, what would have been the price paid/received for the cash commodity on a per unit basis? 8) The individual made the right decision to hedge: Yes or No. 9) What is the net selling (or purchase) price on a per unit basis? The following questions use the table below about a hog farmer needing soybean meal. One contract is for 100 short tons. Now Later $290.00/ton $290.50/ton Cash Soybean Meal Market Futures $279.00/ton $279.50/ton Soybean Meal Market
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