A farmer currently holds $5000$ bushels of corn. The local mill is offering a price today of

$$2\mathrm{.}18$ per bushel. Currently, a three$-$month futures contract is trading at $$2\mathrm{.}24.$ The farmer is

considering selling to the mill versus storing the corn and taking a short futures position.

Storage costs are $1$ cent per bushel per month, payable up front. If the farmer sells today, she

gets a "cash" inventory that she must "store" for three months. If she holds the corn, she

must store the corn for three months and deliver under the terms of the contract. The risk$-$

free rate is $10\%$ p$.$a$.$ Which alternative should the farmer pursue and why? $($Evaluate current

and three$-$month cash flows for both positions$)$