Consider the 90-day futures on stock ABC. Currently, the share price of ABC is $80 per share. The stock is expected to pay a dividend of $1.50 in one month’s time. Assume that the simple interest rate is 8% per year, and that there are 30 days in a month. Determine the price of the futures and the dollar cost of carry, assuming no arbitrage opportunities are present.
Regent Papers is a library of common essays on high school, college, undergraduate and postgraduate topics. We have collected top papers from various institution, students and professors. The papers are based on common essay topics in all subjects.