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1. The Chicago Mercantile Exchange has launched a financial instrument linked to level of rainfall
in Illinois. The contract specifies a payment of $1,000 from the issuer to the buyer for every inch of
rainfall exceeding the average rainfall of a specific month. Which individuals or entities may reap
advantages by purchasing this type of contract? As a purchaser, what are the factors that would
affect the amount you would be willing to pay for this contract?

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1 The Chicago Mercantile Exchange has launched a financial .pdf

  • 1. 1. The Chicago Mercantile Exchange has launched a financial instrument linked to level of rainfall in Illinois. The contract specifies a payment of $1,000 from the issuer to the buyer for every inch of rainfall exceeding the average rainfall of a specific month. Which individuals or entities may reap advantages by purchasing this type of contract? As a purchaser, what are the factors that would affect the amount you would be willing to pay for this contract?