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Find the price bounds for the five-month forward price when: (1) the stock price is $50 today; (2) A trader can borrow money at 5 percent and lend money at 4 percent, where the interest rates are annual simple interest rates; (3) a brokerage commission of 0.5 percent of the stock price is charged today but your broker waives transaction costs on the maturity date.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91788955

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