Question: how to solve this exercise ?The following table shows 2009 gold futures prices for varying contract lengths. Gold is predominantly an investment good, not an

how to solve this exercise ?The following table shows 2009 gold futures prices for varying contract lengths. Gold is predominantly an investment good, not an industrial commodity. Investors hold gold because it diversi es their portfolios and because they hope its price will rise. They do not hold it for its convenience yield.

MONTHS 3 6 9

FUTURES PRICE 917.9 920.85 923.30

Calculate the interest rate faced by traders in gold futures for each of the contract lengths shown below. The spot price is $915.5 per ounce. (Hint: What is the net convenience yield of gold

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