A petrochemical company will buy 1.6 million gals of heating oil in 3 months and has decided to hedge the price using futures contracts on heating oil. The current spot price for heating oil is $2.64/gallon while the current futures price for heating oil fuel price changes is $1.88/gallon. Suppose that in 3 months the spot price of jet fuel and the futures price of heating oil fuel are $2.95 and $1.92 respectively. What is the effective total dollar amount paid for the jet fuel?

Question 5 options:

$4,644,360

$4,656,160

$3,008,000

$4,720,000

None of the above