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below market). To reduce the risk of default you would like to hedge the downside risk of corn prices after harvest for the other half
below market). To reduce the risk of default you would like to hedge the downside risk of corn prices after harvest for the other half of the harvest. The cost of storage is 0.25% per month and the interest rate is 0.25% a month. 4.A. 2pts. Write a formula for deciding whether to hedge your delivery contract by going short on a forward contract for corn or selling your corn right away. 4.B. 2pts. At the time of harvest, August 1, the current price of corn is 11.50 and the 6-month (February 1) future price $13 what do you do
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