The Current Level of Standard & Poor's Index Is 500

question 65

Multiple Choice

The current level of Standard & Poor's index is 500. The prospective dividend yield is 2%, and the interest rate is 6%. What is the value of a one-year futures contract on the index? (Assume all dividend payments occur at the end of the year.)

• A) 530
• B) 520
• C) 540
• D) None of the above

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Definitions:

High Heels

Shoes with raised heels which elevate the wearer's feet significantly higher than their toes.

NSAIDs

Nonsteroidal anti-inflammatory drugs, a class of medications that reduce pain, decrease fever, prevent blood clots, and in higher doses, decrease inflammation.

Collarbone

A long, flat bone located horizontally across the upper part of the chest in humans and some animals, also known as the clavicle, serving as a strut between the shoulder blade and the sternum.

Sternum

A long flat bone located in the center of the chest, connecting the ribs together and providing support.