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PLEASE SOLVE CORRECTLY, asaap Sean Reddington, a squash farmet, has asked you to advise him on how he can protect himself against an adverse price
PLEASE SOLVE CORRECTLY, asaap Sean Reddington, a squash farmet, has asked you to advise him on how he can protect himself against an adverse price movement regarding the sale of nis squash using a futues contract. He expects to have 1,000 tonnes of squash for sale in the summer. It is now early January and the cash pice for squash is 5570 per torne. The settle price on a futares contract to sell squash in June is $550 per tonne. Required: Advise Sean on how he can hedge his rlsk of fluctuations using the futures market and demonstrate the colculation of Sean's resuling tocti reverunt if the cash price for scquash is? a) $530 per tonne in June and the settle price on a futures contract to buy squash is $540 per tonne, (4 marks) b) $600 per tonne in June and the setle price on a futures contract to buy squash is $610 per tonne (4 marks)
PLEASE SOLVE CORRECTLY, asaap
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