A short forward contract on an investment asset that yields 7.2% and was negotiated some time ago
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Question:
A short forward contract on an investment asset that yields 7.2% and was negotiated some time ago will expire in 10 months and has a delivery price of $68. The current spot price of the commodity is $48. The risk-free interest rate (with continuous compounding) is 3.5%. What is the value of the short forward contract.
Related Book For
Advanced Accounting
ISBN: 978-0538480284
11th edition
Authors: Paul M. Fischer, William J. Tayler, Rita H. Cheng
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