Question
Beginning of the planning period (September): The appropriate futures contract is trading at $130.00 per cwt when the cattle are placed in September. End of
Beginning of the planning period (September): The appropriate futures contract is trading at $130.00 per cwt when the cattle are placed in September.
End of the planning period (January): The cattle are finished and ready to be sold. The spot price the cattle will receive is $120.00 per cwt. The appropriate futures contract is trading at $118.00 per cwt.
Calculate the feedlot's per unit net price ($ per cwt) considering both the spot and futures transactions. Show your work.
Net Price = Spot Market Price + Futures Profits =?
Net Price = 120 - (118-130) = 132 cwt
Could yall double check this and make sure that it is right?
Step by Step Solution
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Operations And Supply Chain Management
Authors: F. Robert Jacobs, Richard Chase
14th Edition
978-0077824921, 78024021, 9780077823344, 007782492X, 77823346, 978-0078024023
