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What is the arbitrage-free forward price

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Reference no: EM133002004

The current spot price of gold is $1200 per ounce. The riskless interest rate is 10% per annum. For simplicity, assume there are no storage/security costs of gold.

a) What is the arbitrage-free forward price for the delivery of gold in 8 month's time?

Reference no: EM133002004

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