The cost of carry consists of all the following except
A)the risk-free rate
B)the cost of storage
C)insurance on the asset
D)the risk premium
E)none of the above

Question

Quizplus · Accepted Answer

The cost of carry includes the risk-free rate, the cost of storage, and insurance on the asset. The risk premium, however, is not a component of the cost of carry, as it reflects the additional return investors seek for taking on risk.

The Cost of Carry Consists of All the Following Except