Question: Please Answer A & B Speculative Sam buys a future in the market for a standard contract of pork bellies (10,000 lbs) to sell at

Please Answer A & B

Speculative Sam buys a future in the market for a standard contract of pork bellies (10,000 lbs) to sell at $.75/pound. The dealer offers Sam a margin of 30% at 2.5% per year which Sam accepts (i.e. he pays 70% and borrows 30% to purchase the contract.) If the contract closes 150 days later and the spot price (market) of pork is now $.70

A. What is Sams profit or loss?

B. What is that as a percentage of the money he put up initially?

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