Given a Stock Index with a Value of $1,500, an Anticipated

question 19

Multiple Choice

Given a stock index with a value of $1,500, an anticipated dividend of $62 and a risk-free rate of 5.75%, what should be the value of one futures contract on the index?

• A) $1,343.40
• B) $62.00
• C) $1,418.44
• D) $1,524.25

Recognize the significance of meeting deadlines and understanding the nature of writing assignments.

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Learn how to prepare for unexpected events in the legal profession.

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Definitions:

Discretionary Policy

Economic or fiscal policy based on judgment and decision-making in response to changing economic conditions, rather than set by predetermined rules.

National Saving

The total amount of savings generated within a country, including both private savings by households and public savings by the government.

Interest Rates

The cost of borrowing money or the return on investment for savings, typically expressed as a percentage of the principal amount.

Discretionary Fiscal Policy

Economic strategies implemented by the government through changes in spending levels and tax rates to influence economic conditions.