A Riskless Stock Index Arbitrage Profit Is Possible If the Following

question 30

True/False

A riskless stock index arbitrage profit is possible if the following condition holds: F₀,T = S₀(1 + rf - d)ᵀ,where spot price now is S₀,value now of a futures contract expiring at time T is (F₀,T),rf is the risk free rate and d is the dividend.

---

Definitions:

Meristematic Tissue

Plant tissue found in regions of growth, made up of actively dividing cells that give rise to various organs of the plant.

Bud Scales

Protective structures that cover the developing buds of many plants, shielding them from environmental stresses such as cold temperatures.

Guttation

The exudation of drops of water from the tips or edges of leaves, resulting from root pressure in certain plants.

Transpiration

The process by which moisture is carried through plants from roots to small pores on the underside of leaves, where it changes to vapor and is released to the atmosphere.