Schweser Practice exams, Vol.1, exam 2, Question 37 and 40

Has anyone done this exam yet? I am very confused with question 37 and 40 (P.132), please help!

I think the two questions are basically asking the same thing: how to hedge equity positoins using futures contracts. But the solution Schweser provided are very different:

–> For quesiton 37, the formula is: Number of futures = V(1+Rf)T/Pf(multiplier)

–> For question 40, the formula is: [(Bt-Bp)/Bf]*[Vp/(Pf)(Multiplier)]

I think the two questions are the same, and I used the second formula for both of them, and of course got wrong on the first one.

Can someone please provide some insights?

Thanks. Good luck to all.

I think when you first want to establish a synth position, you use V(1+Rf)T/Pf(multiplier)

When you are selling / buying V(1+Rf)T/Pf(multiplier)

When you are conv the whole port to cash you use (-v(1+r)^ t)/ (pf x multi)

Make sense. Thanks.