Which of the Following Can Explain a Contango

question 35

Multiple Choice

Which of the following can explain a contango?

• A)the interest rate exceeds the dividend yield
• B)the cost of carry is negative
• C)futures prices exceed forward prices
• D)the market is at less than full carry
• E)none of the above

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Definitions:

Categorical Propositions

Statements in logic that relate two categories or classes of things in an affirmative or negative manner.

Disjunctive

Pertaining to a logical relation that holds between two statements if at least one of them is true, most commonly represented by the "or" connective.

Hypothetical

Pertaining to a supposition or proposed explanation made on the basis of limited evidence as a starting point for further investigation or as a suggested point of argument.

Extended Argument

A discussion in which reasons are given in support of a conclusion, typically involving several steps or stages.