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Several months ago, XYZ entered into a long forward contract on an asset with no income. XYZ agreed to pay $30 to seller at
Several months ago, XYZ entered into a long forward contract on an asset with no income. XYZ agreed to pay $30 to seller at maturity. Today, the contract matures in 7 months. The risk-free rate with continuous compounding is 5.2% per annum, the underlying asset price is $36.68. Calculate the value of the above forward contract. Round your answer to the nearest 2 decimal points. For example, if your answer is $12.345, then enter "12.35" in the answer box.
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Step: 1
To calculate the value of the forward contract we can use the following formula Forwar...Get Instant Access to Expert-Tailored Solutions
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Step: 2
Step: 3
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