What is the theoretical forward price

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A one-year long forward contract on crude oil is entered into when the spot price is $60/bbl. and the risk-free rate of interest is 2.00% per annum with continuous compounding. The cost to store a barrel of oil is $2.00 per barrel per year, payable at the end of the year. Please assume there is no convenience yield. What is the theoretical forward price?

Reference no: EM133118993

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