What is the price they offer their customers

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Question: The price of heating oil today (October 16) is $2.10 per gallon. A heating oil company offers customers the opportunity to lock in heating oil for January 16 delivery at the forward price. The risk-free rate is 5% for all times (continuous compounding). What is the price they offer their customers? What if it costs the company 3 cents to store a gallon of heating oil for 3 months starting today?

Reference no: EM132051173

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