Question #2: Futures Contracts [16 Points] Use the following scenario to answer Parts (a) - (c) Suppose that Richie believes that countries that there will be an increase in the global production of aluminum. He thus anticipates that the price of aluminum will decrease. The table below shows the current futures price for a futures contract of aluminum with a delivery date of June 2022. The quoted price is in dollars per metric ton and each contract is for 25 metric tons of aluminum. Assume that the initial margin requirement is 9% and the margin maintenance is 5%. Delivery Month Last June 2022 2015.50 (a) Will Richie want to initiate a long position or a short position on aluminum futures? No explanation is required. [1 Point] (b) Suppose Richie trades 6 option contracts. What is the amount that he must deposit into his margin account to open the futures position? [2 Points) (c) Suppose that the price of aluminum increases to $2223 per metric ton. Will Richie receive a margin call? Explain your answer. [5 Points) Use the following scenario to answer Parts (d) - (0) The chart below shows a quote for a futures contract on the NASDAQ 100 Index Delivery Date Futures Price NASDAQ 100 June 2022 13,916.00 (d) Assume that for the NASDAQ 100 Futures contract the futures price is multiplied by a multiple of $100 to get the total contract value. If the margin requirement is 8%, how much must you deposit into your margin account to purchase four (4) June 2022 NASDAQ 100 contracts? [2 Points] (e) Suppose the NASDAQ 100 index rises to 14,000. What is the percentage return on your investment on the 4 futures contracts? [6 Points]