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1 . You collect data from your broker - dealer regarding the bid and ask prices of a stock and a one - year zero

1. You collect data from your broker-dealer regarding the bid and ask prices of a stock and a one-year zero-coupon bond. The bond has a face value of \(\$ 100\), and the stock is assumed to pay no dividends over the coming year. This information is summarized in Table 1 below.
Table 1: Bond and Stock Price
You can also enter into a forward contract on the stock with a one-year maturity. The forward price, i.e.,\( F \), for this contract is \(\$ 106\). Assuming that entering into the forward contract incurs no cost, what conditions must \( x \) and \( y \) satisfy to ensure the absence of arbitrage?
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