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A sunflower farmer estimates, during February 2020, that he will harvest 60,000kgs of sunflower by December 2020. (a) The price on futures contract for December
A sunflower farmer estimates, during February 2020, that he will harvest 60,000kgs of sunflower by December 2020.
(a) The price on futures contract for December 2020 Sunflower is P6.00 per kg.
Sunflower futures contracts are traded in 5000 kg units
Determine the number of contracts that the farmer can hedge the risk he is-+96 exposed to at the time of harvest in time considering that the price of Sunflower can rise to P6.00 per kg.
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