1. Suppose the S&P 500 index futures price is currently 950 and the initial margin is 10%. You wish to long 10 S&P 500 futures contracts.

(a) What is the notional amount of your position? What is the margin?

(b) Suppose you earn a continuously compounded rate of 6% on your margin balance, your position is marked-to-market weekly, and the maintenance margin is 80% of the initial margin. What is the greatest S&P 500 index futures price 1 week from today at which you will receive a margin call?