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Suppose you long a three-month forward contract at $35. One month later, new forward contracts with similar terms are trading for $30. The continuously compounded

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Suppose you long a three-month forward contract at $35. One month later, new forward contracts with similar terms are trading for $30. The continuously compounded risk-free rate is 10 percent p.a. What is the value of your forward contract? A. $4.96 B. $5.00 C. $4.92 D. $4.55 E. none of the above 3. Suppose you buy a one-year forward contract at $65. At expiration, the spot price is $73. The risk-free rate is 10 percent p.a. What is the value of the contract at expiration? A. -$7.27 B. -$8.00 C. $0.00 D. $7.27 E. none of the above Suppose you long a three-month forward contract at $35. One month later, new forward contracts with similar terms are trading for $30. The continuously compounded risk-free rate is 10 percent p.a. What is the value of your forward contract? A. $4.96 B. $5.00 C. $4.92 D. $4.55 E. none of the above 3. Suppose you buy a one-year forward contract at $65. At expiration, the spot price is $73. The risk-free rate is 10 percent p.a. What is the value of the contract at expiration? A. -$7.27 B. -$8.00 C. $0.00 D. $7.27 E. none of the above

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