I need help with these questions please

1. It is March 1. A US company expects to receive 5,000,000 Euro at the end of October. Futures price on March 1 is 1.12 dollar per Euro. If the spot and futures prices when the contract is closed out are 1.22 dollar and 1.25 dollar per Euro, respectively, what is the effective price per Euro obtained for this US company?

		1.25 dollar per euro
		1.12 dollar per euro
		1.23 dollar per euro
		1.09 dollar per euro

2. A company has a $25 million portfolio with a beta of 0.8. The futures price for a contract on an index is 1200. Futures contracts on $250 times the index can be traded. What trade is necessary to increase beta to 1.5?

		SHORT 43 CONTRACTS
		LONG 58 CONTRACTS
		SHORT 58 CONTRACTS
		LONG 43 CONTRACTS

3. An airline expects to purchase 2 million gallons of jet fuel in one month and decides to use heating oil futures for hedging. Each heating fuel futures contract size = 42,000 gallons. With some historical data, we find the following statistics:

= 0.9, _S = 0.03, _F = 0.04

#1) What is the optimal hedge ratio that should be used?

#2) What is the optimal hedging strategy for this airline company?

		#1) 1.2
		#1) 1.0
		#1) 0.7777
		#1) 0.675
		#2) SHORT 32 FUTURES CONTRACT
		#2) LONG 32 FUTURES CONTRACT
		#2) SHORT 57 FUTURES CONTRACT
		#2) LONG 57 FUTURES CONTRACT

4. A trader has a portfolio worth $15 million that mirrors the performance of a stock index. The stock index is currently 1,150. Futures contract trade on the index with one contract being on 250 times the index. To remove market risk from the portfolio the trader should

		Buy 52 contracts
		Sell 52 contracts
		Sell 20 contracts
		Buy 20 contracts

5. On August 2, an investor holds 40,000 shares of an ABC stock in its portfolio. The market price is $70 per share. The investor is interested in reducing its portfolio beta to 0.5 over the next month and decides to use the September Mini S&P 500 futures contract. The index is currently 1,500 and one contract is for delivery of $50 times the index. The beta of the stock is 1.1. What strategy should the investor follow?

		LONG 41 contracts
		SHORT 41 contracts
		LONG 22 contracts
		SHORT 22 contracts