Beginning of the planning period (September): The appropriate futures contract is trading at $130.00 per cwt when the cattle are placed in September.

End of the planning period (January): The cattle are finished and ready to be sold. The spot price the cattle will receive is $120.00 per cwt. The appropriate futures contract is trading at $118.00 per cwt.

Calculate the feedlot's per unit net price ($ per cwt) considering both the spot and futures transactions. Show your work.

Net Price = Spot Market Price + Futures Profits =?

Net Price = 120 - (118-130) = 132 cwt

Could yall double check this and make sure that it is right?

Answer rating: 100% (QA)

To calculate the net price we need to consider both the spot market price and t... View the full answer