Show how to use the spot$-$futures parity relationship to find a "term structure of futures

prices," that is$,$ futures prices for various maturity dates.

a$)$ Suppose that today is January $1,2016.$ Assume the interest rate is $3\%$ per year and a

stock index currently at $2,000$ pays a dividend yield of $2\%.$ Find the futures price for

contract maturity dates of: $($i$)$ February $14,2016,($ii$)$ May $21,2016,$ and $($iii$)$ November

$18,2016.(3$ points$)$

b$)$ What happens to the term structure of futures prices if the dividend yield is higher than

the risk$-$free rate? For example, what if the dividend yield is $4\%?(3$ points$)$