The following relates to one share of XYZ stock: The current price is 100. The
Question:
The following relates to one share of XYZ stock:
• The current price is 100.
• The forward price for delivery in one year is 105.
• P is the expected price in one year.
Determine which of the following statements about P is TRUE.
(A) P < 100
(B) P = 100
(C) 100 < P < 105
(D) P = 105
(E) P > 105
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