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This is Finance Question 24 3.34 pts You have entered the world of mustard trading. Based on the spot price and other information provided here,
This is Finance
Question 24 3.34 pts You have entered the world of mustard trading. Based on the spot price and other information provided here, determine what should be the price of a contract to deliver a barrel of mustard in a year $40.00 1 1% Spot price per barrel of mustard Time to expiration of futures contract (fraction of a year) Interest rate (per year) Storage costs (per year) Convenience yield (per year in $) Historical volatility $0.80 $1,40 23% What is the fair price of this futures contract? O $38.20 $39.00 O $39.80 $41.20 O $42.60Step by Step Solution
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