A trader owns a commodity that provides no income and has no storage costs as part

of a long-term investment portfolio. The trader can buy the commodity for $1560 per

ounce and sell it for $1558 per ounce. The trader can borrow funds at 7% per year and

invest funds at 6.5% per year. For what range of 1-year forward prices does the trader

have no arbitrage opportunities? Assume the bid and offer for a forward price are the

same.