What total cost would you effectively be locking in based

Assignment Help Financial Management

Reference no: EM131898840

Suppose today is May 1, 2014, and your firm produces breakfast cereal and needs 115,000 bushels of corn in July 2014 for an upcoming promotion. You would like to lock in your costs today because you are concerned that corn prices might rise between now and July. Use Table 23.1

a. What total cost would you effectively be locking in based on the closing price of the day? (Round your answer to the nearest whole number, e.g., 32.)

Total cost $

b. Suppose corn prices are $5.03 per pound in July. What is the profit or loss on your futures position? (Enter your answer as a positive number. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

ProfitLoss $

Reference no: EM131898840

Questions Cloud

Explain the traditional deficit-reduction approach : The use of social media has the potential to significantly change the delivery of training in organizations. Traditionally, training has been focused.

What happens to producer surplus across the entire market : Construction employment grows 22% to 75,000 in Boston. What happens to producer surplus across the entire market

Determine the project completion time : Using the activity table below, construct a CPM/PERT network noting the activity numbers and durations. Identify the critical path through the network.

How much would you be willing to pay for these modifications : What is the actuarially fair insurance premium? How much would you be willing to pay for these modifications?

What total cost would you effectively be locking in based : What total cost would you effectively be locking in based on the closing price of the day?

Explain the intelligence cycle of the intelligence community : Using all of the course readings and any supplemental readings you choose, prepare a paper of 750-1,000 words suggesting measures that could be implemented.

List the benefits associated with implementing technology : Using advanced technology offers a company many benefits, but there are also some challenges involved too. List three benefits and three challenges associated.

Which is moral hazard effect of social security : Education is a good example of. Which is a moral hazard effect of Social Security?

Discuss about the wheel of consumer analysis : Use the Wheel of Consumer Analysis to describe how affect and cognition and behaviors interact with environmental factors in an automatic-purchase situation.

User Account

All Pages