Parker Inc. entered into a September futures contracts on February 18 to hedge the sale of silver on August 31. On February 18, the price of silver was $26.85 per ounce and the September futures price was $27.18 per ounce. Suppose on August 31, the price of silver is $30.15 per ounce and the September futures price is $29.25 per ounce. It closes out its position on August 31. What is the basis when the company closes out its position on August 31?

A.

$3.30

B.

$2.07

C.

$0.90

D.

$2.97