Suppose that there is a hypothetical stock that currently trades at$100, the Libor yield curve is flat and at a level of 5%, and the stock pays a $1 dividend each quarter with the next four expected payments to be in 45, 135, 225, and 315 days. Treating dividends as being payed discretely, compute theoretical futures prices for futures contracts on that stock that mature in:


i. 15 days
ii. 105 days
iii. 195 days
iv. 285 days

Answer rating: 100% (QA)

ANS WER 45 days 101 25 135 days 103 13 225 days 105 ... View the full answer