=+ (b) Six months later, there is a shortage of feed wheat on the market and its

Question:

(b) Six months later, there is a shortage of feed wheat on the market and its price jumps to £151.96 per tonne. The cost of borrowing also increases and the interest rate becomes 1.25%. What is the new forward price (for the remaining six months) and what is the current value of the original long forward contract?

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