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- 4. [5 marks) Index XYZ pays dividends continuously with yield d 0.04. If the 3-month prepaid forward price on the index is the same
- 4. [5 marks) Index XYZ pays dividends continuously with yield d 0.04. If the 3-month prepaid forward price on the index is the same as the 1-year forward price on the index, what is the continuously compounded risk free rate? B)3% D)6% E) None of these A) 2% C) 4%
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