Answer:
A. Buy gold in the spot with borrowed money, and sell the futures contract.
Explanation:
A futures contract is an agreement to buy or sell an asset at a future date at an agreed-upon price while arbitrage is the simultaneous purchase and sale of identical goods or securities that are trading at disparate prices. There is opportunity for riskless profit in arbitrage because of the exploitation of price disparities.
Based on the above definitions, buying gold in the spot with borrowed money, and selling the futures contract since it is overpriced will yield positive riskless arbitrage profits.
