Question
Question 1: Suppose that: The spot price of gold is US$1,400 The 1-year forward price of gold is US$1,420 The 1-year US$ interest rate is
Question 1:
Suppose that:
The spot price of gold is US$1,400
The 1-year forward price of gold is US$1,420
The 1-year US$ interest rate is 6% per annum
Is there an arbitrage opportunity? Why or why not?
Calculate the profit or loss from such a strategy.
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Managing Finance A Socially Responsible Approach
Authors: D. Crowther
1st Edition
0750661011, 978-0750661010
