1. In Mid-October you are buying 50,000 bushels of corn at 80 Dec basis. You could immediately sell it at a cash price of 400 cents per bushel. However, you plan to carry the corn from mid- October until mid-April. You base your cost-of-carry on aninterest rate of 10%. At the end of November you are forced to set your Dec/May spread at a 5 cents inversion.

   By mid-April, your sell basis is at +30 May and you sell the corn.

   What is the Net margin on the transaction?

   		105 cents per bushel
   		110 cents per bushel
   		85 cents per bushel
   		100 cents per bushel