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Please show all work, thank you Today is September. Chesapeake Energy, a major natural gas producer, takes a short position in 42 December Henry Hub

Please show all work, thank you

Today is September. Chesapeake Energy, a major natural gas producer, takes a short position in 42 December Henry Hub natural gas futures contracts at a futures price of $2.91 per million British thermal units (mmBtu.) The objective is to hedge price risk of future sales of natural gas to utility companies. The spot price of natural gas currently is $2.88 per mmBtu. In November, the Exxon Mobil offsets (i.e., closes out) its futures position by taking a long position in the same number of contracts at a futures price of $2.89 per mmBtu. The spot price in November is $0.15 per mmBtu above the futures price. What is Cheasapeake Energys TOTAL gain or loss on its futures position? Ignore transactions costs. The size of the Henry Hub natural gas futures contract is 10,000 mmBtu

(Answer $8,400)

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