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7. Assume the spot price of pork bellies is 74.50 cents per pound and the 2-year forward price is 77.30 cents. Prices of the 1-year
7. Assume the spot price of pork bellies is 74.50 cents per pound and the 2-year forward price is 77.30 cents. Prices of the 1-year and the 2-year zero coupon bond are 0.90 and 0.85, respectively. For a 2-year commodity-linked note to sell at par, what is the annual coupon? (a) 3.65 cents (b) 5.03 cents (c) 6.83 cents (d) 8.12 cents
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