Question
A single stock futures contract on a nondividend-paying stock with current price $110 has a maturity of one year. a. If the T-bill rate is
| A single stock futures contract on a nondividend-paying stock with current price $110 has a maturity of one year. |
| a. | If the T-bill rate is 4.0%, what should the futures price be? (Round your answer to 2 decimal places.) |
| Futures price? |
| b. | What should the futures price be if the T-bill rate is still 4.0% and the maturity of the contract is three years? (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
| Futures price? |
| c. | What if the interest rate is 5.1% and the maturity of the contract is three years? (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
| Futures price? |
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Fundamentals Of Multinational Finance
Authors: Michael H. Moffett, Arthur I. Stonehill, David K. Eiteman
1st Edition
0201844842, 978-0201844849
