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Good day, can someone help me in answering the following question? Thank you. 1. You may need the following equation to answer this question: F=S(1+r+c)
Good day, can someone help me in answering the following question? Thank you.
1. You may need the following equation to answer this question: F=S(1+r+c) a) If the spot price of gold is $31 per ounce, the riskless interest rate is 1% per year, and the storage cost is 2% per year, then evaluate the market price of a one-year gold forward contract. b) If the volatility for a commodity's spot price increases, what happens to the value of European call and put options? c) If the spot price increases for a commodity, what happens to the premiums of European call and put options? d) Identify the change for call and put option premiums, if the maturity increases for the European options
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