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Consider the three-month futures on stock BBM. Presently, the price of stock BBM is $100. The stock is expected to pay a dividend of $2.00 in two months. Suppose that the simple interest rate is 6% per year. Find out the price of the futures supposing no arbitrage opportunities are present.

Risk Management, Finance

  • Category:- Risk Management
  • Reference No.:- M922041

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