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Suppose that: -The spot price of oil is US$95 -The quoted1-year futures price of oil is US$80 -The 1-year US$ interest rateis 5% per annum

Suppose that:

-The spot price of oil is US$95

-The quoted1-year futures price of oil is US$80

-The 1-year US$ interest rateis 5% per annum

-The storagecosts of oil are 2% per annum

Is there an arbitrage opportunity?

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