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Suppose u have 10,000 dollars to invest in the coffee market. To leverage your exposure to this market, you want to buy as many one-year
- Suppose u have 10,000 dollars to invest in the coffee market. To leverage your exposure to this market, you want to buy as many one-year coffee futures contracts as you can afford based on the margin requirement. coffee is selling at $1 a pound and the margin requirement for a futures contract for 10,000 pounds of coffee is $3,000.
- Calculate your return if coffee prices rise to $1.20 a pound. (show ur workings)
- Using examples, mention and explain the quantitative monetary measures in open market operations and varying reserve ratios.
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