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5. Three months ago, an investor entered into a six-month forward contract to sell a stock. The delivery price agreed to was $550. Today, the
5. Three months ago, an investor entered into a six-month forward contract to sell a stock. The delivery price agreed to was $550. Today, the stock is trading at $450. Suppose the interest rate is 4.80% in continuously compounded terms. (a) Assuming the stock is not expected to pay any dividends over the next three months, what is the current forward price of the stock? (b) What is the value of the contract held by the investor
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