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Suppose the risk-free interest rate is 3.65%. A share of stock whose current value is $97 per share will pay a dividend in six months
Suppose the risk-free interest rate is 3.65%. A share of stock whose current value is $97 per share will pay a dividend in six months of $2.50 and another in twelve months of $2.75. Find the values of one-year forward contract and one-year prepaid forward on the stock assuming that transfer of ownership will take place immediately after the second dividend is paid
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