Given a Stock Index with a Value of $1,000, an Anticipated

question 23

Multiple Choice

Given a stock index with a value of $1,000, an anticipated dividend of $30, and a risk-free rate of 6%, what should be the value of one futures contract on the index?

• A)$943.40
• B)$970.00
• C)$1,030.00
• D)$915.09

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Definitions:

Differences

Differences can refer to discrepancies or variations between two or more items, figures, or concepts in various contexts.

Earnings Per Share

A financial ratio that measures the amount of a company's profit allocated to each outstanding share of common stock, indicating a company's profitability.

Computed

Calculated or estimated following a specific procedure or formula.

Evaluate Company

Evaluating a company involves analyzing its financial statements, operations, market position, and future prospects to determine its value and health.