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Calculate the net profit or loss for the contract buyer

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Reference no: EM132505372

Question 1: Given the following information on a gold futures contract, calculate the net profit/loss for the contract buyer if the spot price of gold drops to $1,100/troy oz.

Futures Contract Price           $1,200.00/troy oz

Initial Spot Price                   $1,200.00/troy oz

Contract Size                        100 troy oz

Number of Contracts                    20

Initial Margin Per Contract          $5,000/contract

Maintenance Margin Per Contract  $4,500/contract

Tick Size                                 $0.10/troy oz

Option 1: $20,000

Option 2: $100

Option 3: $50,000

Option 4: $200,000

Reference no: EM132505372

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