Which of the Following Is True When F0,T < E(ST)

question 14

Multiple Choice

Which of the following is true when F0,T < E(ST) ?

• A) Occurs when long hedgers outnumber short hedgers.
• B) Occurs when short hedgers outnumber long hedgers.
• C) The market is said to be in contango.
• D) The market is said to be in normal contango.
• E) The pure expectations hypothesis holds.

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