Question
Illy Caffe has surplus coffee and enters into a short futures contract to sell 5,000 units of Coffee commodity for $70 per unit. The initial
Illy Caffe has surplus coffee and enters into a short futures contract to sell 5,000 units of Coffee commodity for $70 per unit. The initial margin is $40,000 and the maintenance margin is $30,000. (Show Work)
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| Price Sold at | Number Sold | Initial Margin | Maintenance Margin |
| Short Futures Contract | $70 | 5,000 | $40,000 | $30,000 |
What is the futures price per unit above which there will be a margin call?
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Financial Management For Decision Makers
Authors: Peter Atrill
9th Edition
1292311436, 978-1292311432
