A trader owns gold as part of a long-term investment portfolio. The trader can buy gold for $450 per ounce and sell it for $449 per ounce.

A trader owns gold as part of a long-term investment portfolio. Thetrader can buy gold for $450 per ounce and sell it for $449 per ounce.The trader can borrow funds at 6% per year and invest funds at 5.5%per year (both annual compounding). For what range of 1-year forwardprices of gold does the trader have no arbitrage opportunities? Assumethere is no bid-offer spread for forward prices.