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Q 1 0 . Suppose you are a distributor of flaxseed and you observe that the spot price is tf 9 . 9 0 per

Q10. Suppose you are a distributor of flaxseed and you observe that the spot price is tf9.90 per metric ton, and the futures price for delivery a month from now is tf10.18. What should you do if your cost of carry is tf0.20 per metric ton per month?
(a) Choose to carry the flaxseed in storage for another month and hedge by taking a futures position.
(b) Deliver the flaxseed immediately.
(c) Immediately sell the flaxseed in the market for tf9.90 per ton.
(d) Buy more flaxseed for tf9.90 per metric ton and not consider hedging.
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