Suppose the value of the S&P 500 Stock Index is currently $2,100. If the one-year T-bill rate is 3.6% and the expected dividend yield on the S&P 500 is 3.2%.
a. What should the one-year maturity futures price be?
b. What would the one-year maturity futures price be, if the T-bill rate is less than the dividend yield, for example, 2.2%?
Do not round intermediate calculations.