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Consider a forward contract with strike K = 4 and expiration T = 3 on an underlaying S. Suppose that So = 5 and
Consider a forward contract with strike K = 4 and expiration T = 3 on an underlaying S. Suppose that So = 5 and r = 3 (a) What is the value of the forward contract at time zero, Fo? (b) What is the forward price, Ko? (c) What is the price of the forward contract if the strike price K is equal to Ko?
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Engineering Economy
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
16th edition
133439275, 133439274, 9780133819014 , 978-0133439274
