Questions 9 to 14 are based on the following information:

On March 1 a commoditys spot price is $59 and its August futures price is $60. On July 1 the spot price is $65 and the August futures price is $64.

Question 12 (1 point)

What would be the prices received or paid by companies A and B without hedging?

Question 12 options:

	Both are $59.
	Both are $60.
	Both are $64.
	Both are $65.

Question 13 (1 point)

What are the performances of these two companies relative to the situation without any hedging?

Question 13 options:

	Company A does better with hedging than without hedging; company B does worse with hedging than without hedging
	Company A does worse with hedging than without hedging; company B does better with hedging than without hedging
	Both companies do better with hedging
	Both companies do worse with hedging

Question 14 (1 point)

What is the effect of basis risk on these two companies?

Question 14 options:

	Due to basis risk, company A gets unexpected profit while company B gets unexpected loss.
	Due to basis risk, company A gets unexpected loss while company B gets unexpected profit.
	Both companies suffer from unexpected loss due to basis risk.
	Both companies enjoy unexpected profit due to basis risk.