USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 123

Multiple Choice

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 percent, and the annualized dividend is 2 percent. You are currently considering purchasing a two-month futures contract for your portfolio.
-Refer to Exhibit 15.12. Calculate the current price of the futures contract.

• A) 1295.66
• B) 1304.34
• C) 1342.75
• D) 1379.29
• E) 1393.49

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Definitions:

Obama Presidency

The period during which Barack Obama served as the President of the United States, from January 20, 2009, to January 20, 2017.

Hard-Core Republicans

A term describing members of the Republican Party in the United States who are deeply committed to its conservative principles and policies.

Lake Wobegon Effect

The tendency for people to overestimate their abilities or achievements relative to others, named after the fictional town where all the children are above average.

Above Average

Performance or measures that exceed the normal or expected benchmark.