"The **Cost-carry Model** is the futures pricing model that assumes **perfect market efficiency** and **eliminates arbitrage opportunities**. This model determines the futures price by considering the **cost of carrying** the underlying asset, including storage, insurance, and financing costs. It assumes that the futures price should reflect the total cost of holding the asset until the futures contract's expiration. Any deviations from this theoretical price would create arbitrage opportunities, which market participants would quickly exploit, driving the price back to its fair value. **Keywords:** Cost-carry Model, futures pricing, perfect market efficiency, arbitrage opportunities, carrying cost, storage, insurance, financing costs, expiration date.