Assume_tF_T2=_tF_T1(1 +_T1r_T2) +_T1C_T2is the equilibrium situation.

Also assume that T₂- T₁is one year, that_T1C_T2= $1 and that_T1r_T2= 10%.

Assume the initial prices are_tF^o_T1= 100 &_tF^o_T2= 133.

This is not an equilibrium situation.

Say the next day, t + 1, the_t+1F_T1price adjusts to 115.

What would be the equilibrium price for_t+1F_T2?

112

None of these represent an equilibrium price for_t+1F_T2

127.5

122