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Suppose that the risk-free interest rate is 9% per annum with continuous compounding and that the dividend yield on a stock index is 3% per

Suppose that the risk-free interest rate is 9% per annum with continuous compounding and that the dividend yield on a stock index is 3% per annum. The index is standing at 500, and the futures price for a contract deliverable in four months is 520.

What arbitrage opportunities does this create?

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