1.Today is August 1, 2012. Referring to Table 2.2, your friend has told you that you could make money by trading September 2012 and March 2013 futures contracts on wheat. Assume you can borrow and lend at 5% per annum, compounded continuously. Is your friend right? If so, how much profit could you make per one contract, if there was no storage costs for wheat? Note that quotes are in cents per bushel. Could you also make money by trading similar futures on soybeans? Ignore the effects of daily settlement procedures. [Hint: consider taking offsetting positions in the two contracts!]

Please help !!!!!!

Table 2.2 Futures quotes for a selection of CME Group contracts on commodities on May 26, 2010 Open High Low Settlement Change Volume Open interest Gold 100 s per oz une 2010 1203.80 1216.90 1201.00 1213.40 15.40 194,461 156.156 July 2010 1205.00 1217.50 1202.00 1214.20 15.50 838 714 Aug. 2010 1205.00 1218.70 1202.70 1215.30 15.50 130,676 240,074 Oct. 2010 1208.30 1220.20 1205.30 1217.50 15.60 2,445 21.792 Dec. 2010 1208.80 1222.90 1207.50 1219.90 15.60 7,885 61.497 June 2011 1215.90 1228.00 1215.20 1227.80 15.80 408 13,461 Crude oil 1,000 barrels, S per barrel July 2010 70.06 71.70 69.21 71.51 2.76 6,315 388,902 Aug. 2010 71.25 72.77 70.42 72.54 2.44 3,746 115,305 Dec. 2010 74.00 75.34 73.17 75.23 2.19 5,055 196.033 Dec. 2011 77.01 78.59 76.51 78.53 2.00 4,175 100,674 Dec. 2012 78.50 80.21 78.50 80.18 1.86 1,258 70,126 Corn 5,000 bushels, cents per bushel July 2010 369.50 372.00 368.75 371.50 7.25 122,528 491,587 Sept. 2010 379.50 381.00 379.00 381.00 7.75 24,186 175.798 Dec. 2010 389.00 390.75 380.25 390.75 8.00 47,428 373,026 Mar. 2011 400.00 403.25 400.00 403.25 7.75 4,581 55,836 May 2011 410.50 411.50 410.50 411.50 7.25 830 8,995 July 2011 417.50 419.50 417.50 419.50 7.50 3,491 31,939 Dec. 2011 416.25 418.00 415.75 418.00 7.25 4,760 59.061 Soybeans 5,000 bushels, cents per bushel July 2010 934.25 939.75 933.00 938.00 7.50 41,816 220.712 Aug. 2010 922.00 931.50 922.00 929.50 8.50 4,881 15,674 Sept. 2010 914.50 918.75 912.50 916.50 7.00 1.935 12.983 Nov. 2010 906.00 912.50 905.00 910.00 7.00 18,908 157,826 Jan. 2011 917.75 921.50 914.75 919.75 7.00 2,621 12,391 Mar. 2011 926.00 930.00 925.00 928.50 8.00 1.406 5,857 May 2011 933.50 935.50 931.00 933.50 7.50 942 5,626 Wheat 5,000 bushels, cents per bushel July 2010 462.75 472.00 459.00 461.75 1.25 45,283 246.683 Sept. 2010 480.00 489.00 476.50 479.00 1.00 13,941 Dec. 2010 510.75 519.50 507.25 510.00 1.25 56 70,618 Mar. 2011 541.50 548.50 536.75 539.00 0.75 2,748 27,879 May 2011 557.00 563.50 552.75 555.50 1.25 923 8.199 July 2011 574.25 583.00 571.00 573.75 0.75 4,938 34,300 Live Cattle 40,000 lb, cents per lb une 2010 90.800 90.850 90.450 90.800 0.775 12,410 51,817 Aug. 2010 89.700 90.050 89.525 89.925 0.850 19,341 144,587 Oct. 2010 91.100 91.150 90.750 91.100 0.750 7,718 78,300 Dec. 2010 92.100 92.250 91.875 92.175 0.800 3,347 42.102 Feb. 2011 93.200 93.550 93.200 93.550 0.800 792 18,428