A mining company agrees to receive $2.65/pound for the next 3 years, in return it will...

Transcribed Image Text:

A mining company agrees to receive $2.65/pound for the next 3 years, in return it will pay the average price (spot) of copper each year. Average prices for copper equal: 2.65, 2.60, 2.40 What do net cash flows look like from the company's view? A. 0, 0.05, 0.25 B. 0, -0.05, -0.25 C. 0, 0.5, -0.15 D. 0.05, 0.10, 0.30 A mining company agrees to receive $2.65/pound for the next 3 years, in return it will pay the average price (spot) of copper each year. Average prices for copper equal: 2.65, 2.60, 2.40 What do net cash flows look like from the company's view? A. 0, 0.05, 0.25 B. 0, -0.05, -0.25 C. 0, 0.5, -0.15 D. 0.05, 0.10, 0.30