Explain when the dividends should be similar to discounted

Question

Explain when the dividends should be similar to discounted.

Answer 1

When there are dividends upon the underlying stock throughout the life of the options, we should adjust the equation to permit for this. We now get that C − P is equal to S − Present value of all dividends − Ee^{−r (T−t)}.
This, certainly, assumes that we identify what the dividends will be. Just discount the strike back to the present using the value of a zero-coupon bond along with maturity similar as the expiration of the option, if interest rates are not constant. Dividends must the same be discounted.