Question: Question 4 (8 marks) a. Suppose you purchase 4 orange juice contracts at the futures price of $1.3 per pound. The contract size is 15.000

Question 4 (8 marks) a. Suppose you purchase 4 orange juice

Question 4 (8 marks) a. Suppose you purchase 4 orange juice contracts at the futures price of $1.3 per pound. The contract size is 15.000 pounds. i. How much do these 4 contracts cost you? (2 marks) 11. If the futures price is lower by 3 cents per pound, how much do you make or lose? (3 marks) b. A call option sells for $5. It has a strike price of $35 and three months until expiration. If the underlying stock sells for $37 per share, what is the price of a put option with an $35 strike price and three months until expiration? The risk-free interest rate is 6% per year

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