You are trying to value a 3-month futures contract on a stock.The market rate of return is 11.2 percent,the risk-free rate is 3.8 percent,and the dividend yield on the stock is 2.6 percent.The stock is currently selling for $33 a share.What is the value of "T" as used in the formula for computing the future stock price (FT = S(1 - r) ^T) ?
A) .112
B) .250
C) .026
D) .038
E) .064
Correct Answer:
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