Exhibit 21 -Refer to Exhibit 21

Exhibit 21.1
Use the Information Below for the Following Problem(S)
In late January 2004, The Union Cosmos Company is considering the sale of $100 million in 10-year debentures that will probably be rated AAA like the firm's other bond issues. The firm is anxious to proceed at today's rate of 10.5 percent. As treasurer, you know that it will take until sometime in April to get the issue registered and sold. Therefore, you suggest that the firm hedge the pending issue using Treasury bond futures contracts each representing $100,000.
$$\begin{array} { l c c } & \text { Casel } & \text { Case2 } \\ \text { Current Value - January 2004 } & & \\\text { Bond Rate } & 10.5 \% & 10.5 \% \\\text { June 2004 Treasury Bonds } & 78.875 & 78.875 \\\text { Estimated Values - Aprì 2004 } & & \\\quad \text { Bond Rate } & 11.0 \% & 10.0 \% \\\text { June 2004 Trea5ury Bonds } & 75.93 & 81.84\end{array}$$
-Refer to Exhibit 21.1.What is the dollar gain or loss assuming that future conditions described in Case 2 actually occur? (Ignore commissions and margin costs,and assume a naive hedge ratio.)

A) $2,965,000.00 gain
B) $45,500.00 gain
C) $2,965,000.00 loss
D) $45,500.00 loss
E) None of the above