Spring 2022 ARE 321 Homework # 11 Extra Credit a. A small soybean grower expects to harvest one hundred thousand bushels in four months. The current cash price for the crop is $4.25 per bushel. The soybean futures contract that matures in four months is currently trading at 425, or $4.25 per bushel. Each contract is for five thousand bushels. How many futures contracts should the grower trade to hedge the crop price risk? b. Which should the grower do-sell short or go long? In four months the price of soybeans is $5.00 per bushel due to drought, and the futures contract is trading at 500. How much is the gain or loss on the cash crop? On the futures contracts? Is this an effective hedge? Explain. (2.5 Points each for all 4 parts) C. d