1 A stock currently trades at R38 and quarterly dividends of 25 cents are due 1 month and 4-months from now. Find the 3-month forward price of this stock if the risk-free rate is 2%, accumulate one dividend over 2-months.

2. Forward price of a stock paying semi-annual dividends. A stock currently trades at R67 and a semi-annual dividend of R2 is due sometime before the maturity of a forward contract. If the forward contract matures in 4 months. Given that the risk-free rate is 3%. Find when the dividend is due.

3. Evolution of the forward price. A 3-month forward contract is issued today. The current stock price is R34 and the risk free rate is 6%. Consider the following: the stock price increases to R37 1-month later and decreases to R35 1-month prior to maturity. Calculate the forward price after each month in this scenario.

4. A stock currently trades at R84 and the interest rate is 1.25%. The 6-month forward price of this stock is quoted at R85. Construct an arbitrage strategy given this scenario.