Your trading account has $285,000 of cash on April 1 before you begin trading on the same date. The next trading date i

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Your trading account has $285,000 of cash on April 1 before you
begin trading on the same date. The next trading date is
October 1 with a simplifying assumption that there is no margin
recalculation before that date. You want to trade the Crude
Oil futures, where the broker's margin requirement is the initial
margin of $2,560 per contract and a maintenance margin of $2,020
per contract. (Ignore any interest, commissions, or borrow
fees.) Each future contract provides exposure to 1,000
barrels of crude oil. To set up the trade, on April 1, you
take a SHORT position in 30 futures contracts settling in October
at $45 per barrel and also a LONG position in 30 futures contracts
settling next year at $41 per barrel. Then, on October 1, you
close out both positions when the October contract is trading at
the then-spot price of $48 per barrel and the next-year contract is
trading at $45 per barrel. How much Futures Liability will be
in your account on April 1 immediately after the trades?
Futures Liability is the cash amount you have agreed to pay
at the settlement date under your futures contract.
Question 22 options:
$1,137,750
$1,168,500
$1,199,250
$1,230,000
$1,260,750