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If the spot rate of copper is $ 3 0 0 per ounce and the one year forward rate is $ 3 0 0 per
If the spot rate of copper is $ per ounce and the one year forward rate is $ per ounce, and the one year interest rate is per annum.
a Explain whether an arbitrage opportunity exist.
b If so explain how an investor would exploit such an opportunity.
cApproximate his payoff.
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