Question: A short forward contract that was negotiated some time ago will expire in 8 - month and has a delivery price of $ 4 7

A short forward contract that was negotiated some time ago will expire in 8-month and has a delivery price of $47.00. The current forward price for the 8-month forward contract is $48.75. The 8-month risk-free interest rate (with continuous compounding) is 7.95%. What is the value of the short forward contract? Answer with two decimal digits accuracy and the correct sign. Example: -11.92
 A short forward contract that was negotiated some time ago will

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!