Considering a trade in a forward contract

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A dealer in a commodity is considering a trade in a forward contract. The current spot price of the commodity is $500 per unit, the forward price for delivery in 1 year is $540 per unit and the annual inventory costs are 2% of the current spot price. The implied risk free rate is closest to....... , and the arbitrage profit that could be earned per unit of the commodity in period 1 if the risk-free rate of return is 5% pa in period 0 is

Reference no: EM132544475

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