Question: use excel and show steps please Problem-02a: Current S&P Index is at 3,800. Suppose you take a long (buy) position on 6, six, S&P 500
Problem-02a: Current S&P Index is at 3,800. Suppose you take a long (buy) position on 6, six, S&P 500 futures contracts when the futures price of the index is 3,890.00. Assume that maturity of the futures contracts is one- month. (The size of one future contract is equal to ($250)x(Index Value). i. What is your profit/loss (P/L) if S&P 500 index value is 3,935.00 at maturity? ii. What is your profit/loss (P/L) if S&P 500 index value is 3,806.00 at maturity? Problem-02b: Using information in problem 02a: i. Graph your P/L function for likely S&P 500 index numbers between 3,600.00 and 4,100.00 in increments of 20 at maturity. Label both axes properly! ii. Is the graph linear? If yes, what is the slope of the P/L graph. iii. Write down the function of the graph you draw. (The function must not be presented in terms of x and y!) iv. Locate problem-02a results on the graph in problem-02b
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