Given a Stock Index with a Value of $1,100, an Anticipated

question 77

Multiple Choice

Given a stock index with a value of $1,100, an anticipated dividend of $27, and a risk-free rate of 3%, what should be the value of one futures contract on the index?

• A)$943.40
• B)$970.00
• C)$913.40
• D)$1,106.00

---

Definitions:

Short-Term Financing

Funding obtained for a period typically less than a year, used to cover immediate financial needs of a business.

Acquisition Of Inventory

The process a business undertakes to obtain supplies or products that it intends to sell to its customers.

Accounts Payable Period

This is the average number of days it takes for a business to pay its invoices from suppliers and vendors, indicating the efficiency of its payables management.