(8–4)

Put–Call Parity The current price of a stock is $33, and the annual risk-free rate is 6%. A call option with a strike price of $32 and with 1 year until expiration has a current value of

$6.56. What is the value of a put option written on the stock with the same exercise price and expiration date as the call option?

CHALLENGING PROBLEMS 5–7