Question: Consider a forward contract on Stock A where the forward price for delivery 1 year hence is $54. If the annual interest rate (under annual

Consider a forward contract on Stock A where the forward price for delivery 1 year hence is $54. If the annual interest rate (under annual compounding) is 10% and the current stock price is $50, what is the current value of this forward contract? (Note that if compounding is annual, then the value of $1 after a year is $(1+r).)

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