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The contract size for platinum futures is 50 troy ounces. Suppose you need 400 troy ounces...

The contract size for platinum futures is 50 troy ounces. Suppose you need 400 troy ounces of platinum and the current futures price is $1,255 per ounce. How many contracts do you need to purchase? How much will you pay for your platinum? What is your dollar profit if platinum sells for $1,295 a troy ounce when the futures contract expires? What if the price is $1,200 at expiration? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to the nearest whole number.)

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1 How many contracts do you need to purchase?
Number of contract to purchase = 400/50 8 Contract
2 How much will you pay for your platinum
Payment required = 8*1255*50 = $      502,000
3 What is your dollar profit if platinum sells for $1,295 a troy ounce when the futures contract expires
Profit = =(1295-1255)*8*50 $         16,000
4 What if the price is $1,200 at expiration
Loss = =(1200-1255)*8*50 -22000
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