{b} Assume hedger takes hedge ratio as h", i.e, if the risk exposure is a long position of 100 units of spot commodity, to hedge the risk, hedger will short 19011 * futures underlying on that commodity. Please answer the questions in the right panel in analogy to the left panel, by filling the blanks in j) r] below [6 marks in total, 0.5 marks each]: If the stock price falls from 3 to 2, then If the stock price rises from 3 to 4, then a) the future price falls from 3 to 2; j) the future price b) hedger makes profit (3-2)x100h*=100h* from k) hedger makes from the the future, at t=1; future, at t=1; c) by investing the profit from t=1 till t=2, 100h* from t=1 till t=2, dollars profit becomes (1+0.1)x100h*=110h*; becomes d) meanwhile, hedger makes a loss of 100x(2-3)= -100 from the stock at t=1; m) meanwhile, hedger makes a profit e) hedger doesn't make further loss on stock from the stock at t=1; from t=1 to t=2; n) hedger doesn't make further f) net profit/loss is [110h*-100] dollars; on stock from t=1 to t=2; g) stock price is 2 at t=2, hence the value of stock o) net profit/loss is at t=2 is 2x100=200; p) stock price is at t=2, hence the value of stock at t=2 is h) the value of futures is its gain and loss, hence, at t=2, its value is 110h*; q) the value of futures is its gain and loss, hence, i) the value of the portfolio is the sum of the at t=2, its value is value of stock and the value of futures, which is r) the value of the portfolio is the sum of the [200+110h*]. value of stock and the value of futures, which is