Calculate the forward price today

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a) The current price of a stock is $55. The continuous compounded risk-free rate is 8% per annum. The stock is expected to pay a dividend of $1 in one month and four months. An investor enters into a short position in a six-month forward contract on this stock today.

i. Calculate the forward price today.

ii. Discuss the difference between forward pricing for investment assets and forward pricing for consumption assets.

Reference no: EM132833299

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