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You are given the following information about two related forwards: ABC pays continuous dividend = 2% ABC stock sells for 90. The no arbitrage price

You are given the following information about two related forwards: ABC pays continuous dividend = 2% ABC stock sells for 90. The no arbitrage price for a one year forward contract on ABC is 92.861. (Use this to find r).

XYZ stock pays a single discrete dividend of 1.80 at t = 1. XYZ stock sells for 60. the interest rate is continuously compounded and applies to both forwards. Compute the no-arbitrage price for a two year forward on XYZ.

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