Trader enters into a short position in a silver futures contract for 5,000 troy ounces with delivery in 120 days. The futures price is $26_.50 and the initial margin is USD 15,000 per contract.

a- Provide three reasons why the trader might want to enter into a long position?

b- Compute the value of the trader's margin account after 6 days, if the futures price drops by $2 on the first day, then increases by $1.5 dollars on each of the following 5 days.

c- After 10 days the trader wants to close out her position. Explain how she can do that?

d- Compute the trader's profit from the investment after closing out her position on day 10 if the futures price is $24.