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# It is now January. The current interest rate is 6.4%. The June futures price for gold is $1485.80, while the December futures price is $1,494.

It is now January. The current interest rate is 6.4%. The June futures price for gold is $1485.80, while the December futures price is $1,494. Assume the June contract expires in exactly 6 months and the December contract expires in exactly 12 months.

**a. **Calculate the appropriate price for December futures using the parity relationship? **(Do not round intermediate calculations.** **Round your answer to 2 decimal place.)**

Price for December futures $

**b. **Is there an arbitrage opportunity here?

No | |

Yes |

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