Which of the following statements is least accurate? The forward price of a consumption asset has no upper bound. The cost of carry of a stock index is the difference between the risk-free rate and the index dividend yield. Gold is an investment asset and cotton is a consumption asset. The value of a forward contract is close to zero when initially entered.
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The forward price of a consumption asset has no upper bound - This statement is accurate. The forward price of a consumption asset can theoretically increase indefinitely, as there is no limit to how much someone may be willing to pay for it in the future. Show more…
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