1. A prepaid forward contract is one where the buyer has to pay the seller at the time the contract is written, rather than at the settlement date. (a) (4 points) Calculate the price F(0;0) of a prepaid forward contract in the case of no dividends. Make sure to explain your reasoning in terms of both the buyer and the seller. (b) (9 points) Suppose that a stock pays a fixed cash dividend amount D(ti) at fixed times ti, where 0