Oil costs $0.33 per barrel to store for a month but gives a convenience yield of $0.15 per barrel per month. The storage costs are
Oil costs $0.33 per barrel to store for a month but gives a convenience yield of $0.15 per barrel per month. The storage costs are paid at the end of the year and the convenience yield accrues at the end of the year too. If the interest rate is 2.5% and the spot price is $52 per barrel, the futures price of oil for delivery in one year is nearest to?
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Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
1st edition
978-0133251579, 133251578, 013216230X, 978-0134102313, 134102312, 978-0132162302
