3. Fischer Sports GmbH is a single source supplier in the fields of Alpine and Nordic skiing equipment. Fischer Sports is the global market leader in Nordic skiing and one of the world's largest ski producers. Fischer Sports is considering a weather call option to protect its sales against unexpectedly warm weather in November through March. Assume that the strike price is 250, the payment rate is $1,200 per degree day, and the payment cap is $250,000. a) What measure should be used, cumulative heating degree days (HDD) or cumulative cooling degree days (CDD)? (5 pts) b) If the number of cumulative degree days turns out to be 386, what is the company's payoff? (5 pts) de la mim c) If the number of cumulative degree days turns out to be 462, what is the company's payoff? (5 pts) 5. Use the following information for a stock. So - $60 H (Expected return) -6% (Standard deviation) - 15% Find the range of the stock price in 2 months with a 95% confidence level. Assume that the stock price follows a lognormal distribution. (10 pts) 3. Fischer Sports GmbH is a single source supplier in the fields of Alpine and Nordic skiing equipment. Fischer Sports is the global market leader in Nordic skiing and one of the world's largest ski producers. Fischer Sports is considering a weather call option to protect its sales against unexpectedly warm weather in November through March. Assume that the strike price is 250, the payment rate is $1,200 per degree day, and the payment cap is $250,000. a) What measure should be used, cumulative heating degree days (HDD) or cumulative cooling degree days (CDD)? (5 pts) b) If the number of cumulative degree days turns out to be 386, what is the company's payoff? (5 pts) de la mim c) If the number of cumulative degree days turns out to be 462, what is the company's payoff? (5 pts) 5. Use the following information for a stock. So - $60 H (Expected return) -6% (Standard deviation) - 15% Find the range of the stock price in 2 months with a 95% confidence level. Assume that the stock price follows a lognormal distribution. (10 pts)