Assume that by June, the price of crude palm oil in the cash market has fallen to RM2,245 per metric tonne and the June crude palm oil futures is also trading at the same price. The producer closes out the futures position by buying back the contracts. 

i. Determine the net gain from his transaction.

ii. Determine the effective price per metric tonne of palm oil. 

 

Answer rating: 100% (QA)

i The net gain from the producers transaction can be calculated by finding the difference betwe... View the full answer