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The December Eurodollar futures contract is quoted as 98.40 and a company plans to borrow $8 million for three months starting in December at LIBOR

The December Eurodollar futures contract is quoted as 98.40 and a company plans to borrow $8 million for three months starting in December at LIBOR plus 0.5%. What rate can the company lock in by using the Eurodollar futures contract? What position should the company take in the contracts? If the actual three-month rate turns out to be 1.3%. what is the final settlement price on the futures contracts. Explain why timing mismatches reduce the effectiveness of the hedge

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