Entered into firm commitment to purchase gold

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1. On February 1, 2009 Hills company entered into a firm commitment to purchase gold for $85,000 during April 2010. The market value of gold on February 1 2009 is $496 per ounce. To hedge this position Hills could enter into which of the following:

A. Go long in a gold forward contract B. Enter into a futures contract to sell gold C. Enter into a futures contract to buy gold D. Sell a gold put option

2. Weston Corporation just paid a dividend of $1.75 a share (i.e., D0 = $1.75). The dividend is expected to grow 12% a year for the next 3 years and then at 5% a year thereafter. What is the expected dividend per share for each of the next 5 years? Round your answers to two decimal places.

D1 = $

D2 = $

D3 = $

D4 = $

D5 = $

Reference no: EM131879497

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