Question: 2. Arbitrage Using a Forward A stock currently sells for $100, and it will pay no dividends in the future. Consider a 6-month forward contract

2. Arbitrage Using a Forward

A stock currently sells for $100, and it will pay no dividends in the future. Consider a 6-month forward contract on this stock. The forward price is $107. The risk-free rate is 4% per annum. Is there an arbitrage? If so, show the arbitrage strategy using a table listing asset positions and cash flows.

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