The gold lease rate is 2.5% pa. The cost of storing gold is $3 per ounce per
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The gold lease rate is 2.5% pa. The cost of storing gold is $3 per ounce per year, with the payment being made at the end of the year. The spot price of gold is $450 per ounce and the risk-free rate is 7% pa continuous compounding for all maturities. Calculate the price of a one-year forward contract.
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