Problem $10-5($LG $10-2)$

Dudley Savings Bank wishes to take a position in Treasury bond futures contracts, which currently have a quote of $109-100.$ Dudley Savings thinks interest rates will go down over the period of investment. The face value of the bond underlying the futures contract is $$100,000.$

a$.$ Should the bank go long or short on the futures contracts?

b$.$ Given your answer to part $($a$),$ calculate the net profit to Dudley Savings Bank if the price of the futures contracts increases to $109230.($Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to $2$ decimal places. $($e$.$g$.,32\mathrm{.}16))$

c$.$ Given your answer to part $($a$),$ calculate the net profit to Dudley Savings Bank if the price of the futures contracts decreases to $108290.($Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to $2$ decimal places. $($e$.$g$.,32\mathrm{.}16))$

Answer is complete but not entirely correct.

$\backslash$table$[[$a$.,$The futures contracts,Long,$(],[$b$.,$Net profit,$$,406\mathrm{.}25],[$c$.,$Net profit,$$,(468\mathrm{.}75)ox$