What would be the spot price if a stock index futures price were $75, the risk-free rate were 10 percent, the continuously compounded dividend yield is 3 percent, and the futures contract expires in three months?

What would be the spot price if a stock index futures price were $75, the risk-free rate were 10 percent, the continuously compounded dividend yield is 3 percent, and the futures contract expires in three months?




a. $73.70
b. $77.48
c. $72.60
d. $76.32
e. none of the above




Answer: D


Learn More :