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Corn call options with a $1.70 strike price are trading for a $0.15 premium. Farmer Jayne decides to ...

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Corn call options with a $1.70 strike price are trading for a $0.15 premium. Farmer Jayne decides to ...

Corn call options with a $1.70 strike price are trading for a $0.15 premium. Farmer Jayne decides to hedge her 20,000 bushels of corn by selling short call options. Six-month interest rates are 4.0% and she plans to close her position and sell her corn in 6 months. What is her profit or loss if spot prices are $1.60 per bushel when she closes her position?
A) $1,000 loss
B) $2,000 gain
C) $2,120 loss
D) $2,120 gain

Textbook

Derivatives Markets

Edition: 3^rd

Author: McDonald

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phuongha2892

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More solutions for this book are available here

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elf_fu Author

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6 years ago

Correct

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mbangu

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5 years ago

Really helpful!

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chuchulika

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4 years ago

thank you

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Chunlin Z.

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4 years ago

thx

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Lingqian R.

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3 years ago

thanks

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Data B.

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3 years ago

sfs
s

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