Assume that futures on 50 bushels of wheat have an initial margin requirement of $12 per contract and a maintenance margin requirement of $7 per contract. Consider also a buyer and seller of 100 contracts for wheat futures initiated in period 0 and settled in period 4. The settlement prices of wheat futures expiring in period 4 evolve as follows: period (0):$130; period (1):$126; period (2):$120; period (3):$128 and period (4):$131.

a) Assume no party withdraws margin from their account. Describe the evolution of the margin account for each party. b) Assume that each party always removes any margin above the initial margin in each period and describe the evolution of the margin accounts for each party under this assumption. c) What must be the price of 50 bushels of wheat in period 4?