What should the one-year maturity futures price be

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Question - Suppose the value of the S&P 500 stock index is currently 1,900. If the 1-year T-bill rate is 6% and the expected dividend yield on the S&P 500 is 5%, what should the 1-year maturity futures price be? What if the T-bill rate is less than the dividend yield, for example, 1%?

Reference no: EM132946885

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