$2.(25$ pts$.$ total$)$ Suppose XYZ stock pays no dividends and has a current price of $$50.$ The forward price for delivery in $1$ year is $$55.$ Suppose the $1-$year effective annual interest rate is $10\%$

a$.$ Graph the payoff $(6$ pts$.)$ and profit $(6$ pts$.)$ diagrams for a forward contract on XYZ stock with a forward price of $$55.$

b$.$ Is there any advantage to investing in the stock versus the forward contract $(1\mathrm{.}5$ pt$.)?$ Why $(5$ pts$.)?$

c$.$ Suppose XYZ paid a dividend of $$2$ per year and everything else stayed the same. Now, is there any advantage to investing in the stock versus the forward contract $(1\mathrm{.}5$ pt$.)?$ Why $(5$ pts$.)?$