Today is January 1. Forward prices for gold forward maturing on April 1 is $1,500 per ounce.

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Today is January 1. Forward prices for gold forward maturing on April 1 is $1,500 per ounce. The simple interest rate is 6 percent per year. What would be the forward price for a forward contract on gold maturing on August 1?

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An Introduction to Derivative Securities Financial Markets and Risk Management

ISBN: 978-0393913071

1st edition

Authors: Robert A. Jarrow, Arkadev Chatterjee

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Question Posted: Dec 02, 2015 03:17 AM

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Today is January 1. Forward prices for gold forward maturing on April 1 is $1,500 per ounce.

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In this problem we first find the spot price and use this to compute the August forward price The da...View the full answer

An Introduction to Derivative Securities Financial Markets and Risk Management

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