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A one-year long forward contract on a non-dividend-paying stock is entered into when the stock price is $200 and the risk-free interest rate is 8%
A one-year long forward contract on a non-dividend-paying stock is entered into when the stock price is $200 and the risk-free interest rate is 8% per annum (continuous compounding). Three months later, the price of the stock is $140 and the risk-free interest rate remains unchanged.
What is the value of the forward contract for delivery of one share?
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