Dudley savings bank wishes to take a position in treasury


Dudley Savings Bank wishes to take a position in Treasury bond futures contracts, which currently have a quote of 115 − 100. Dudley Savings thinks interest rates will go down over the period of investment. The face value of the bond underlying the futures contract is $100,000.

Given your answer to part (a), calculate the net profit to Dudley Savings Bank if the price of the futures contracts increases to 115 − 240. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Given your answer to part (a), calculate the net profit to Dudley Savings Bank if the price of the futures contracts decreases to 114 − 300. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))

Please show me the fomula too.

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Financial Management: Dudley savings bank wishes to take a position in treasury
Reference No:- TGS01729670

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