GARP Exam 2016-FRR Topic 3 Question 7 Discussion

Actual exam question for GARP's 2016-FRR exam

Question #: 7
Topic #: 3

[All 2016-FRR Questions]

Which one of the following four relationships should be used to price equity forwards or futures?

AEquity forward or futures price = market equity price + (1 + risk-free rate -- expected dividend rate)t

BEquity forward or futures price = market equity price x (1 - risk-free rate -- expected dividend rate)t

CEquity forward or futures price = market equity price x (1 + risk-free rate -- expected dividend rate)t

DEquity forward or futures price = market equity price + (1 + risk-free rate + expected dividend rate)t

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Suggested Answer: C

by Aileen at Jun 15, 2025, 06:41 PM

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21 hours ago

I think the answer is C.

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