As a financial analyst at Deutsche Bank, you are analyzing how futres will be used to reduce the risk. It is March 31, 2021 now. A company knows that it will need to purchase 30,000 barrels of crude oil sometime in June. You have collected the following information about the futures contracts. The current May oil futures price is $25.00 per barrel and the current July oil futures price is $27. On June 11, the spot oil price is $28 per barrel and the company decides to take oil position (one oil futures contract =1,000 barrels) and July futures price is $29. a. What futures contract should be used for hedge purpose? (sample answer: May Futures; or July Futures) b. What will be the net cost of oil per barrel if you take a long position in the oil futures contracts on April 15, 2020? (Sample Answer: $25.50)