Suppose the value of the S&P 500 Stock Index is currently $2,000. If the one-year T-bill rate is 4.5% and the expected dividend yie on the S&P 500 is 4.0%. . What should the one-year maturity futures price be? (Do not round intermediate calculations.) Futures price . What would the one-year maturity futures price be, if the T-bill rate is less than the dividend yield, for example, 3.0% ? (Do not ro Intermediate calculations.) Futures price $

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Chapter1: Investments: Background And Issues
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Suppose the value of the S&P 500 Stock Index is currently $2,000. If the one-year T-bill rate is 4.5% and the expected dividend yield
on the S&P 500 is 4.0%.
a. What should the one-year maturity futures price be? (Do not round intermediate calculations.)
Futures price
$
b. What would the one-year maturity futures price be, if the T-bill rate is less than the dividend yield, for example, 3.0% ? (Do not round
intermediate calculations.)
$
Futures price
Transcribed Image Text:Suppose the value of the S&P 500 Stock Index is currently $2,000. If the one-year T-bill rate is 4.5% and the expected dividend yield on the S&P 500 is 4.0%. a. What should the one-year maturity futures price be? (Do not round intermediate calculations.) Futures price $ b. What would the one-year maturity futures price be, if the T-bill rate is less than the dividend yield, for example, 3.0% ? (Do not round intermediate calculations.) $ Futures price
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