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45. Suppose the spot value of Kryptonite commodity is currently $700. If the oneyear Tbill rate is 1% and the storage yield is 2% and
45. Suppose the spot value of Kryptonite commodity is currently $700. If the oneyear Tbill rate is 1% and the storage yield is 2% and the convenience yield is 5%, what should the oneyear maturity futures price be? Assume continuous compounded yields. 46. Is the above Kryptonite commodity in previous problem in contango or backwardation? Why?
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