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A 15-month futures contract on an equity index is currently trading at USD 3,767.52. The underlying index is currently valued at USD 3,625 and has a annually compounded dividend yield of 6% per year. The annually compounded risk-free rate is 5% per year. Assuming no transactions costs, what is the potential arbitrage profit per contract and the appropriate strategy?
A
USD 185, buy the futures contract and sell the underlying.
B
USD 4, buy the futures contract and sell the underlying.
C
USD 185, sell the futures contract and buy the underlying.
D
USD 4, sell the futures contract and buy the underlying.