The nearest cent of three-year forward contract

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Reference no: EM132017951

The spot price of an investment asset that provides no income is $30 and the risk-free rate for all maturities (with continuous compounding) is 10%. a) What, to the nearest cent, is the three-year forward price? b) Assume that the asset provides an income of $2 at the end of the first year and at the end of the second year, what would be the forward price now? C) In question 3. a what is the value to the nearest cent of a three-year forward contract with a delivery price of $30?

Reference no: EM132017951

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