Read Question 12 in Chapter 16. For Part D, answer the question in the last bullet, based on part D. These questions in the last bullet of part D are:

A. If crude oil prices rise to $135, how much will they make or lose on the collar strategy above, on a per barrel basis (and state whether profit or loss)?

B. If crude oil prices fall to $70, how much will they make or pay out on the option collar on a per barrel basis?

C. If they buy the crude oil in the cash market, how much will be the net amount they pay for crude oil (assume it is a perfect hedge) on a per barrel basis?

Hint: I show how to work this problem in one of the videos over Chapter 16.

Question 27 options:

A)	A. $17.00 per barrel loss; B. $27.00 per barrel gain; C. $70.00 effective cost of crude oil.

B)	A. There is no payout on the collar strategy.; B. $27.00 per barrel loss; C. $97.00 effective cost of crude oil.

C)	A. $17.00 per barrel profit; B. There is no gain or loss on the collar.; C. $97.00 effective cost of crude oil.

D)	A. $16.21 per barrel profit; B. $26.21 per barrel loss; C. $97.00 effective cost of crude oil.

E)	A. $17.00 per barrel profit; B. $27.00 per barrel loss; C. $97.00 effective cost of crude oil.

F)	A. $16.21 per barrel profit; B. $26.21 per barrel loss; C. $96.21 effective cost of crude oil.

G)	It is impossible to tell.