A futures contract covers 5000 pounds with a minimum price change of $0.01 is sold for $31.60

Fantastic news! We've Found the answer you've been seeking!

Question:

A futures contract covers 5000 pounds with a minimum price change of $0.01 is sold for $31.60 per pound. If the initial margin is $2,525 and the maintenance margin is $1,000, at what price would there be a margin call?

Related Book For answer-question

Financial management theory and practice

ISBN: 978-1439078099

13th edition

Authors: Eugene F. Brigham and Michael C. Ehrhardt

See More Books

Posted Date: Dec 31, 2018 10:57 AM

See More Questions

What arguments would there be for and against Sunseeker changing its long-standing strategy to, for example: a. Compete more aggressively at the budget end of the market? b. Concentrate on Europe or...
What benefit would there be in having multiple tunnels joining the same two points on the edge of an MPLS network? Please provide details
What impact would there be on BCWS, BCWP, ACWP, and cost and schedule variances as a result of the: a. Early start of an activity on a PERT chart? b. Late start of an activity on a PERT chart?
In 2014, Elbert Corporation had net cash provided by operating activities of $531,000; net cash used by investing activities of $963,000; and net cash provided by financing activities of $585,000. At...
Name some industries in which job order costing is common.
The purpose of this exercise is reinforce the relationship between the elements of a cause of action and the relevance of specific evidence. Remember, a piece of evidence is relevant if it makes a...
What is chance in the context of a research hypothesis? And what do we do about chance in our experiments? .
During 2011 the following selected transactions affecting stockholders equity occurred for Orlando Corporation: a. Apr. 1 Purchased in the market 200 shares of the companys own common stock at $20...
You are required to pick a current ("hot", widely discussed) economic event that relates to the material (topic) we have covered or will cover in this course. This paper has to show your ability to...
Imagine that instead of pipetting up to 1 mL of the 50-ppm stock solution of nitrite, you pipetted between 10-50 mL of the stock solution to make your standard solutions. What would your calibration...
Brief the attached appellate court case, the brief of State v. Coe should be no longer than one page. The briefing must follow the following format: Give the: Citation. Facts. Issues. Decision....
If prior charge capital = 30,000 and total capital = 210,000, what is the gearing?
Can you initialize a constant-length array when it is defined? Can you initialize a VLA when it is defined?
Scot and Joplin are in partnership. They share profits in the ratio: Scot 70 per cent; Joplin 30 per cent. The following trial balance was extracted as at 31 December 2013. Required: Draw up a set of...
The following figures relate to the retail business of A. Bell for the month of July 2012. Goods which are on sale fall into two categories, X and Y. You are to calculate for each category of goods:...
Which looping statement(s) are best for counter-controlled looping? Which are best for sentinel-controlled looping?
Write sequence of constructor calling indicating the type of constructor when lg1 is created in main(). In above scenario base Animal's default constructor is called although Animal(x) is specified...
(a) Water flows through the nozzle of a garden hose. Find an expression for m in terms of line pressure P 1 , ambient pressure P 2 , inside hose diameter D 1 , and nozzle outlet diameter D 2 . Assume...
There is a common misconception that defense attorneys must do everything that their clients tell them. Defendants can only make certain decisions in their case: 1. whether to go to trial or plea; 2....
Suppose a firm estimates its overall cost of capital for the coming year to be 10%. What might be reasonable costs of capital for average-risk, high-risk projects?
Why do creditors usually accept a plan for financial rehabilitation rather than demand liquidation of the business?
Messman Manufacturing will issue common stock to the public for $30. The expected dividend and the growth in dividends are $3.00 per share and 5%, respectively. If the floating cost is 2% of the...
Stevenson Company's trial balance as of December 31, 2022 shows $$35,000$ for inventory; but the balance sheet shows $$33,000.$ Assuming no inventory shrinkage, what is the most likely reason for...
Amanda Company started business at the beginning of 2022. The company applies the lower-of-cost- or-net-realizable-value rule to its inventory as a whole. Inventory cost and market value as of the...
Which one of the following costs is not included in inventory for manufacturing firms? a. Raw materials used in production b. Raw materials unused and stored in the warehouse c. Salary paid to the...

A futures contract covers 5000 pounds with a minimum price change of $0.01 is sold for $31.60

Question:

Expert Answer:

Initial margin is 2525 Maintenance margin is 1000 Total price change is 5000 p... View the full answer

Financial management theory and practice

Students also viewed these finance questions