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The risk-free rate is 5% and the dividend yield on the S&P 500 index is 2%. Which of the following is correct when a futures
The risk-free rate is 5% and the dividend yield on the S&P 500 index is 2%. Which of the following is correct when a futures option on the index is being valued?
The futures price of the S&P 500 is treated like a stock paying a dividend yield of 5%. | ||
The futures price of the S&P 500 is treated like a stock paying a dividend yield of 2%. | ||
The futures price of the S&P 500 is treated like a stock paying a dividend yield of 3%. | ||
The futures price of the S&P 500 is treated like a non-dividend-paying stock. |
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