. it is september 25th. a company knows that it will need to purchase 800,000 barrels of gasoline sometime in november or early in december. the spot price of gasoline is $ 52 per barrel. the current december oil futures price is $40 per barrel and a contract is for 1,000 barrels. a) the company decides to use december oil futures contract to hedge their risk. how many december oil futures contract the company should use, if the optimal hedge ratio is 0.875? what position should company take (long or short)?

additional info: after taking action in part a, the company closes its hedge on november 10 and buys the gasoline from spot market. on november 10, the spot price of gasoline turns out to be $56 and price of december oil futures contract turns out to be $43. b) what is the gain/loss from futures position?

C what is the effective cost of gasoline per barrel for the company ?