Please answer the following questions using the table below.

	Aviation Fuel Spot Price at end of June	Gasoline Futures Price at the end of June for the Contract maturing in mid-September	Crude Oil Futures Price at the end of June for the Contract maturing in mid-September
1967	$0.5000	$0.5480	$20.09
1968	$0.4143	$0.4571	$15.32
1969	$0.5036	$0.5510	$19.50
1970	$0.4881	$0.5365	$17.72
1971	$0.5940	$0.6072	$20.54
1972	$0.6690	$0.6088	$21.57
1973	$0.5690	$0.5502	$19.11
1974	$0.4845	$0.5367	$18.83
1975	$0.5119	$0.5338	$17.25
1976	$0.5726	$0.5927	$20.10
1977	$0.5833	$0.5750	$19.84
1978	$0.3679	$0.4787	$14.67
1979	$0.4726	$0.5657	$19.30
1980	$0.8107	$0.9519	$31.13
1981	$0.7167	$0.7241	$26.09
1982	$0.6333	$0.7729	$26.71
1983	$0.6905	$0.8492	$29.77

Consider hedging the US$ cost of Qantass June-end 1983 aviation fuel purchases by establishing a position on 31/12/1982 in futures that mature in mid- September. Use the 1967 through 1982 data in the table above to determine:

(1) whether it would be better to hedge with gasoline or crude futures contracts that mature in September and

(2) how many contracts of the chosen type would you trade?

Notes:

- Each crude oil futures contract covers 1,000 barrels.

- Each gasoline futures contract covers 42,000 gallons.

- The airline uses around 392,500,000 gallons of aviation fuel quarterly.