Question: A forward contract is sold at t = 0 with a forward price F 0 = $135. Suppose the spot price (S 0 ) at
A forward contract is sold at t = 0 with a forward price F0 = $135. Suppose the spot price (S0) at t = 0 is $115, and the expiration day spot price is ST = $125. What is the value of the contract to the seller of this forward at expiration?
| -$5.00 | ||
| -$10.00 | ||
| $10.00 | ||
| $5.00 | ||
| $20.00 |
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