You are a short hedger when you initially check the cash, Ask an Expert

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You are a short hedger, when you initially check the cash market and sell a futures contract, the basis is -$1.00; when you sell in the cash market and off-set your futures position, the basis is -$0.56. (please show work and formulas used for reference)

a. Is the basis weaker or narrower?

b. Is this good for you as a short hedger or not?

c. How much weaker or narrower is the basis?

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91821194

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