3/15 [15 Marks] As a manufacturing firm manager, you must procure a metal-based raw material after one month. The historical data over the past
3/15 [15 Marks] As a manufacturing firm manager, you must procure a metal-based raw material after one month. The historical data over the past five months reflects the price fluctuation in this metal-based raw material. The monthly prices over the past five months have been (earliest) 1050, 1180, 920, 775, and 1350 (latest), respectively. However, there is no futures contract for the raw material you need, but three other similar futures contracts are available. The three futures contracts are Metal A, Metal B, and Metal C. Historical (annual) correlations of monthly price change between the raw material you need and the available futures contracts are given in the table. 2020-21 2021-22 2022-23 Metal A 0.76 0.89 0.32 Metal B 0.74 0.73 0.19 Metal C 0.7 0.72 0.25 Other data given are as follows:
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