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WeRScared will need 1,000 barrels of oil a year from now, and decides to lock into a rate of $50/barrel (which happens to be the
WeRScared will need 1,000 barrels of oil a year from now, and decides to lock into a rate of $50/barrel (which happens to be the current spot price) and purchase a futures contract right now (assume a single contract with a size of 1,000 barrels). The initial margin on the contract is 10%, and the maintenance margin is 5%. At the end of the 1st day, the oil drops by $1 in the spot market, to $49. It continues to lose $1 per day for the next 10 days. WeRScared will receive the first margin call at the end of the ___ day.
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