Hello, need help with 2 Problems

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Thank you!

1. (50 pts) a. (10 pts) Briefly describe what a futures contract is. b. (20 pts) What is the difference between initial margin & maintenance margin on a futures contract? c. (20 pts) One futures contract on orange juice is equal to 15,000 lbs. of juice. Assume that the contract is trading at around $ 1.46/lb. If the initial margin for an orange juice contract is $1,320, approximately what is the leverage an investor enjoys by trading this commodity? 2. (50 pts) As mentioned in class, the \"big\" S&P stock index futures contract trades only \"in the pit,\" whereas the \"E-mini\" S&P contract trades only electronically. The E-mini contract is worth 1/5 of the value of the \"big\" contract. a. (10 pts) Recently, the E-mini contract closed at 2065. What was the total value represented by one E-mini S&P contract as of the day of that close? b. (5 pts) If you think the S&P index is likely to go down in the near future, would you buy or sell an E-mini futures contract? c. (5 pts) Based on the margin requirements given at: http://www.eltee.de/en/usefulsmargins.php how much initial margin would you have to put up to buy or sell 1 contract? d. (15 pts) Assume that in two weeks, the contract closes at 2000. What would be your profit or loss, given the action you answered for part b? e. (15 pts) Assume now that the trade went against you, i.e., the price of the contract goes down instead of up. At what contract price would you have gotten a margin call? How much additional margin will you need to deposit in your account