Use the following information to answer the question(s)below.
An exchange traded fund (ETF)is a security that represents a portfolio of individual stocks.Consider an ETF for which each share represents a portfolio of two shares of Apple Inc.(APPL),one share of Google (GOOG),and ten shares of Microsoft (MSFT).Suppose the current stock prices of each individual stock are as shown below:
-Suppose that a security with a risk-free cash flow of $1000 one year from now trades for $930 today.If there are no arbitrage opportunities,then the current risk-free rate is closest to:
A)6.0%.
B)6.5%.
C)7.0%.
D)7.5%.

Question

Use the following information to answer the question(s)below.
An exchange traded fund (ETF)is a security that represents a portfolio of individual stocks.Consider an ETF for which each share represents a portfolio of two shares of Apple Inc.(APPL),one share of Google (GOOG),and ten shares of Microsoft (MSFT).Suppose the current stock prices of each individual stock are as shown below: 
-Suppose that a security with a risk-free cash flow of $1000 one year from now trades for $930 today.If there are no arbitrage opportunities,then the current risk-free rate is closest to:
A)6.0%. 
B)6.5%. 
C)7.0%. 
D)7.5%.

Quizplus · Accepted Answer

The Answer of Use the following information to answer the question(s)below.
An exchange traded fund (ETF)is a security that represents a portfolio of individual stocks.Consider an ETF for which each share represents a portfolio of two shares of Apple Inc.(APPL),one share of Google (GOOG),and ten shares of Microsoft (MSFT).Suppose the current stock prices of each individual stock are as shown below: 
-Suppose that a security with a risk-free cash flow of $1000 one year from now trades for $930 today.If there are no arbitrage opportunities,then the current risk-free rate is closest to:
A)6.0%. 
B)6.5%. 
C)7.0%. 
D)7.5%.

Use the Following Information to Answer the Question(s)below