Confirm this is right, and provide reasons why?

Great West States (GWS) is a railroad company operating in the western United States. Juanita Salazar is risk manager of GWS. At the direction of the company's chief executive officer, she is searching for ways to handle the company's risks in a more economical way. The CEO stressed that Juanita should consider not only pure risks but also financial risks. Juanita discovered that a significant financial risk facing the organization is a commodity price riskthe risk of a significant increase in the price of fuel for the company's locomotives. A review of the company's income and expense statement showed that last year about 28 percent of its expenses were related to fuel oil. Juanita was also asked to determine whether the installation of a new sprinkler system at the corporate headquarters building would be justified. The cost of the project would be $40,000. She estimates the project would provide an after-tax net cash flow of $25,000 per year for three years, with the first of these cash flows coming one year after investment in the project. The company is considering expanding its routes to include Colorado, New Mexico, Texas, and Oklahoma. It is concerned about the number of derailments thatmight occur. Juanita ran a regression with "thousands of miles GWS locomotives traveled" as the independent variable and "number of derailments" as the dependent variable. Results of the regression are as follow: Y = 2.31 + .022X With the expansion, GWS trains will travel an estimated 640,000 miles next year.

With regard to the fuel price risk: (fill the blank spaces). Copy the below para and right the correct answer only in blank space and submit.

1. GWS could ______(sell/buy) futures contracts to hedge the fuel oil price risk. If the price of fuel oil is lower in the future, GWS will be able to _____ (purchase/sell) fuel oil at a lower price but _____ (loss/gain) money on its futures positions. If the fuel price increases in the future, GWS will ______(lose/gain) money by have to pay _____(lower/higher) price for fuel oil, but it can offset the _____(lower/higher) spot price with _____(lose/gain) on its futures position.

GWS couldselloil futures contracts to hedge the fuel oil price risk. If the price of fuel oil is lower in the future, GWS will be able topurchasefuel oil at a lower price butlosemoney on its futures position. If the price of fuel oil increases in the future, GWS willlosemoney by having to pay ahigherprice for fuel oil, but it can offset thehigherspot price with againon its futures position.