futures contracts at $$147,000$ per contract. It is July and the contracts must be closed out in December of this year. Long$-$term interest rates are currently $10\mathrm{.}30$ percent. If they increase to $12\mathrm{.}50$ percent, assume the value of the contracts will go down by $5$ percent. Also, if interest rates do increase by $2\mathrm{.}2$ percent, assume the firm will have additional interest expense on its business loans and other commitments of $$61,000.$ This expense, of course, will be separate from the futures contracts.

a$.$ What will be the profit or loss on the futures contract if interest rates increase to $12\mathrm{.}50$ percent by December when the contract is closed out?

on futures contracts

b$-1.$ After considering the hedging, what is the net cost to the firm of the increased interest expense of $$61,000?$

Net cost

b$-2.$ What percent of this $$61,000$ cost did the treasurer effectively hedge away?

Note: Input your answer as a percent rounded to $2$ decimal nlaces