Exhibit 21.10 Use the Information Below for the Following Problem(S)

question 49

Multiple Choice

Exhibit 21.10
Use the Information Below for the Following Problem(S)
The S&P 500 stock index is at 1300. The annualized interest rate is 4.0% and the annualized dividend is 2%. You are currently considering purchasing a 2-month futures contract for your portfolio.
-Refer to Exhibit 21.10.If the futures contract was currently available for 1280,indicate the appropriate strategy that would earn an arbitrage profit.

• A) Long futures, and short the index.
• B) Short futures and long the index.
• C) Long futures and long the index.
• D) Short futures and short the index.
• E) None of the above.

---

Definitions:

Municipalities

Local government entities that are responsible for providing basic services and governance within a specified geographic area or city.

Mining

The process of extracting minerals, metals, and other valuable materials from the earth through various techniques.

Industrial Ecology

An interdisciplinary field focusing on sustainable industrial practices, aiming to reduce waste and efficiently use resources through ecosystem-inspired approaches.

Reusable Glass Bottles

Containers made of glass designed to be used multiple times for storing beverages or other liquids, promoting sustainability by reducing waste.