A speculator enters into a short position in five October cotton futures contracts at $0.835 per pound. The contract size is 50,000 pounds. The initial margin is $2,433 per contract, and the maintenance margin is $2,250 per contract. Calculate the futures price F such that, if the futures price rises above F, then the trader receives a margin call. 

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To solve this problem we need to calculate the total value of the short position and the total margi... View the full answer