The Davis Company grows soybeans and processes them into
soybean meal for eventual sale to food companies. Davis currently
owns 10,000 tons of soybean meal, carried in their inventory at a
cost of $3,400,000. Soybean meal trades on the spot markets for
$350 per ton; three-month futures are selling for $363 per ton.
Davis expects to sell the 10,000 tons for 90 days. On August 1,
2017, Davis sells 10,000 tons of soybean meal futures to be
delivered on October...