FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Suppose the initial margin on heating oil futures is $8,400, the maintenance margin is $7,200 per contract, and you establish a long position of 10

Suppose the initial margin on heating oil futures is $8,400, the maintenance margin is $7,200 per contract, and you establish a long position of 10 contracts today.Each contract represents 42,000 gallons. What is the maximum price decline (in dollars per gallon) on each contract that you can sustain without getting a margin call?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Real Estate Finance

Real Estate Finance

Authors: John P. Wiedemer, ‎ Keith J. Baker

9th edition

324181426, 324181425, 978-0324181425

More Books

Students also viewed these Finance questions

Question

★★★★★
Match the items in the left-hand column with the descriptions/explanations in the right-hand column. Items 1. Current exchange rate 2. Foreign entity goodwill under translation 3. Increase in the...

Answered: 1 week ago

Question

★★★★★
Explain what a demand curve is and why it is usually downsloping. Then give an example of a product for which the demand curve might not be down-sloping over some possible price ranges. Explain the...

Answered: 1 week ago

Question

★★★★★
In the article Tumor-associated antigen TA-90 immune complex assay predicts subclinical metastasis and survival for patients with early stage melanoma published in the journal Cancer (Kelley et al.,...

Answered: 1 week ago

Question

★★★★★
The comparative balance sheets of Orpheum Movie Theater Company at June 30, 2014, and 2013, reported the following: Orpheum Movie Theaters transactions during the year ended June 30, 2014, included:...

Answered: 1 week ago

Question

★★★★★
Question 3 (10 marks) B. Wise is planning to start up a new business in East York. Before he started trading, he bought a van for $4,550, a market stall for $3,000 and inventory for $1,570. He did...

Answered: 1 week ago

Question

★★★★★
It has been noted that the average cost to board a patient in the ED is higher (~$50 per patient bed-hour) than the cost to house the patient on either an inpatient floor (~$25 per patient bed-hour)...

Answered: 1 week ago

Question

★★★★★
A daily magazine stand contractor has newspaper stands along various stations on a train route. The demand for magazines is normally distributed and comes from three different forecasting models....

Answered: 1 week ago

Question

★★★★★
A photo frame production line operates 10 hours per day, 5 days per week and can produce 230 televisions per hour. In a typical day, employees have two 30-minute coffee breaks and one 1-hour lunch...

Answered: 1 week ago

Question

★★★★★
FAST DELIVERY SERVICES delivers packages in the city area and hires drivers to make deliveries. Variable costs has been budgeted and an average standard time has been established to make a delivery....

Answered: 1 week ago

Question

★★★★★
Calculate a 90% confidence level. What is the T-Confidence level? Column1 Mean 29347.5 Standard Error 5974.512153 Median 25325 Mode #N/A Standard Deviati 18893.06631 Sample Variance 356947954.7...

Answered: 1 week ago

Question

★★★★★
Accounting break-even Unit price Unit variable cost 18,980 $103 ? Fixed costs Depreciation $425,860 $372,118 What is the Unit Variable Cost? Note: Do not put the $ sign and only use two decimal...

Answered: 1 week ago

Question

★★★★★
No recycle answers please! Patriot Act Compare the potential of invasion of individuals' privacy from the USA Patriot Act and the average business

Answered: 1 week ago

Question

★★★★★
Which one of the following items would most likely not be incorporated into the calculation of a divisions investment base when using the residual income approach for performance measurement and...

Answered: 1 week ago

Question

★★★★★
A flexible budget Classifies budget requests by activity and estimates the benefits arising from each activity Presents a statement of expectations for a period but does not present a firm commitment...

Answered: 1 week ago

Question

★★★★★
What are the principal causes of changes in gross profit? pg2

Answered: 1 week ago

Previous Question Next Question