Question: A forward contract with 8 months to maturity is written on an underlying share. Themarket price of the share is $34, and it is expected

A forward contract with 8 months to maturity is written on an underlying share. Themarket price of the share is $34, and it is expected to pay dividends of $1.40 after 2months and $2 immediately prior to maturity of the forward. The relevant riskless rateof interest is 4%. Calculate the theoretical forward price and initial value of the forward contract and explain the forward pricing relationship

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