a) As a general rule of thumb, a long position in futures will be profitable when prices increase. So if you were a confectioner, and you are concerned over a possible increase in the price of cocoa, you would hedge your position by taking a long position in cocoa futures. Hence, if cocoa prices were to increase, your loss in the spot market would be offset by a gain in the cocoa futures position. However, in the case of interest rate futures, if you plan to borrow money in the near future, and you are worried about a possible increase in interest rates, the appropriate hedging strategy would be to take a short position in interest rate futures. How do you explain this? b) Derivative exchanges can curb excessive speculative trading by increasing margin requirements. Very high margins would severely reduce leverage and thus discourage speculators. Despite this, exchanges would not indiscriminately (simply) increase margin requirements. Briefly explain why