six-month euro interest rate. 2. A stock is expected to pay a dividend of S1 per share in 2 months and in 5 months. The stock price is $50, and the risk-free rate of interest is 8% per annum with continuous compounding for all maturities. An investor has just taken a short position in a 6-month forward contract on the stock. (a) What are the forward price and the initial value of the forward (b) Three months later, the price of the stock is $48 and the risk-free and the value of the short position in the forward contract? contract? rate of interest is still 8% per annum. What are the forward price