2. Pacific Commodity Exchange begins trading in CFTC-approved futures contracts in Frozen Concentrated Oaken-aged Chardonnay (or FCOC). "Locals' Mondavi, Krug, Beringer and Wente are eager to speculate during FCOC's inaugural pit trading. You're hired by PCE officials to monitor and accurately record all Chardonnay futures activity.

a) For each of the following trade times:

1)record resulting aggregate open interest & trading volume; and

2)describe (in about one sentence)motives/goals behind those trades:

8:30 a.m. Chardonnay pit opens for the first time ever.

8:31 a.m. Krug sells 5 Sept.'s to Mondavi (who buys 5)

8:37 a.m. Krug buys 4 Dec.'s from Wente (2) and Beringer(2) (a four-and-one-half 'lunchtime' ensues)

1:05 p.m. Mondavi sells 5 Sept.'s to Krug (1) and Wente (4) 1:55 p.m. Wente (2)& Beringer (2) buy Dec.'s from Krug (4)

1:59 p.m. Krug and Wente go 'ex pit' EFP one(1) Sept. contract

b) Why is there disparity between volume and open interest?