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A long position in a forward contract that was negotiated some time ago will expire in three months and has a delivery price of $29. The current forward price for three-month forward contracts (on the same asset and with the same expiration date as your original contract) is $31. The annualized, continuously compounded risk-free rate for this three-month period is 2.81% per year. What is the value of a long position in the forward contract?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92361457

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