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Consider a 100-day forward contract on a non-dividend paying stock. The stock is currently trading at Sh. 700. The risk-free rate is 6%. Required (i)

Consider a 100-day forward contract on a non-dividend paying stock. The stock is currently trading at Sh. 700. The risk-free rate is 6%. Required (i) Calculate the no arbitrage forward price today. (ii)If the forward price was Sh. 720. Determine the arbitrage strategy.

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