Given a Stock Index with a Value of $1,125, an Anticipated

question 11

Multiple Choice

Given a stock index with a value of $1,125, an anticipated dividend of $33, and a risk-free rate of 4%, what should be the value of one futures contract on the index?

• A) $1137.00
• B) $1070.00
• C) $993.40
• D) $995.09
• E) $1000.00

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Definitions:

Diet

The combination of foods and beverages consumed by an individual, often considered in terms of nutritional quality and balance.

Body Mass Index (BMI)

An estimate of obesity determined by body weight and height.

Obese

A condition characterized by excessive body fat accumulation that presents a risk to health, typically defined by a Body Mass Index (BMI) of 30 or higher.

Overeating

The act of consuming food in quantities greater than the energy expenditure of the individual, often leading to weight gain and potential health issues.