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    Futures and Net Cash Flow

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    On March 1, you contract to take delivery of 1 ounce of gold for $415. The agreement is good for any day up to April 1. Throughout March, the price of gold hit a low of $385 and hit a high of $435. The price settled on March 31 at $420, and on April 1st you settle your futures agreement at that price. Your net cash flow is:

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    Under the futures contract you will pay $415 to take delivery of 1 ounce of gold. ...

    Solution Summary

    The solution determines the futures and net cash flow.