A stock is expected to pay a dividend of 240 per share in 1, Ask an Expert

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A stock is expected to pay a dividend of $2.40 per share in 1 months and in 4 months. The current stock price is $51, and the risk-free interest rate is 7% per annum with continuous compounding for all maturities. An investor has just taken a long position in a 5-month forward contract on the stock. Calculate the forward price.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91260971

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