Question
The 3- and 12-month forward prices for corn are $8.40 per bushel and $8.20 per bushel. The interest rate is 3% per annum with continuous
The 3- and 12-month forward prices for corn are $8.40 per bushel and $8.20 per bushel. The interest rate is 3% per annum with continuous compounding. What is the 18-month forward price? How to make an arbitrage profit if the 18-month forward price is $8.025 per bushel and the storage cost is 1.25% per annum.? Show the transactions for 1,000 bushels
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Finance For Non Financial Managers
Authors: Pierre G. Bergeron
5th Edition
0176104070, 9780176104078
