You purchased 2 Soybean Oil futures contracts today at the settlement price listed as following.

Soybean Oil (CBT) 60,000 lbs.; cents per lb. $15.29

Part I.

If there is a 10% initial margin requirement on total value of underlyings, how much do you have to deposit? Maintenance margin requirement is $600 for each contract. In what situation will you receive a margin call from your broker?

(4 Marks)

Part II.

Assume the volatility of Soybean Oil immediately increases 20%. How will it impact Futures price? How will it impact investor's margin account requirement? Explain your answer.