Please answer the questions below on separate sheets and show your steps (no step, no score) 1. Now is January 2021. Sophie will buy 50,000 pounds of lean hog in March 2021. To hedge the hog price, she buys a March 2021 maturity lean hog contract at the future price of $1.20 per pound. Suppose that when the contract matures in March 2021, the market price of hog turns out to be $1 per pound. This future contract calls for purchase of 50,000 pounds. a) Calculate Sophie's payoff from purchasing 50,000 pounds of hogs in the spot market in March 2021 (note: a payment for purchase is a negative payoff); b) Calculate Sophie's long payoff from the future market in March 2021; c) Calculate Sophie's total payoff from both the spot and future markets in March 2021; d) If the market price of hog goes up to $1.50 per pound in March 2021, what's Sophie's total payoff? Is it the same as the total payoff in part c)? Why? e) Draw the future contract payoff graph for Sophie