5. A share of stock currently sells for $96. The stock pays two dividends of $8 per share, one six months from now and the other one year from now. The annual continuously compounded rate of interest is 5.6%, what is a lower bound for a 1-year European put option with strike price of $86? Hint: $0.6597 6. A non-dividend paying stock is trading at So 96. American put options are written with K 100. What is the maximum price of the put option at which early exercise might be optimal? Hint: $4