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Spot price S = Rs 200; risk-free rate 6% pa, time 6 months, no dividends. The theoretical forward price F is:
ARs 212.00
BRs 206.00
CRs 200.00
DRs 218.00
Answer & Solution
Correct answer: B. Rs 206.00
1. Identify what the question asks: this concept maps to forwardpricing (§4).
2. Apply the framework or formula relevant to the topic.
3. Eliminate distractors and arrive at the correct option (B).
_Source: ICAI BoS CA Final Paper 2, Ch 9 "Derivatives Analysis and Valuation"_
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