A trader owns 55,000 troy oz of silver and decides to hedge with 6-month silver futures contracts. Each futures contract is on 5,000 troy oz. The standard deviation of the change in the spot price of silver is 0.43. The standard deviation of the change in silver futures prices is 0.40. The coefficient of correlation between the two is 0.95.
a) What is the minimum variance hedge ratio?b) What is the optimal number of futures contracts without tailing the hedge?c) What is the optimal number of futures contracts with tailing the hedge? Assume the same hedge ratio.

Amanufacturing firm is considering overhauling the existing compensation strategy. currently every front line employee who works on the assembly line earns the same hourly wage. ideally, management would like to institute a new pay system that involves pay-for-performance. which of the following recommendations is both consistent with scientific management's general emphases and generally good advice for management of this firma. the firm should adopt a differential pay system with one pay level for average performance, and a higher level for good performance. b. the firm should adopt a differential pay system, but the firm should modify it from its original design and provide many different levels of pay associated with different performance levels. c. the firm should understand worker psychology and to focus on pay as the key motivator. d. all of the abovee. none of the above