Question: (25 pts) Why does a full carry model apply so well to the US Treasury bond and S&P 500 futures contracts? What modifications do we

  1. (25 pts) Why does a full carry model apply so well to the US Treasury bond and S&P 500 futures contracts? What modifications do we have to make to the carry model to value US treasury bond futures? What modification do we have to make to the carry model to value S&P 500 mini futures contract? Why? Explain in detail.

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