The spot price of oil is $80 per barrel and the cost of storing a barrel of

Question:

The spot price of oil is $80 per barrel and the cost of storing a barrel of oil for one year is

$3, payable at the end of the year. The risk-free interest rate is 5% per annum continuously compounded. What is an upper bound for the one-year futures price of oil?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: