Options [4] Suppose a share of stock is trading at 30, a put with a strike of

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Suppose a share of stock is trading at 30, a put with a strike of 28 is trading at 1 and a call with strike 29 at 8. The maturity of both options is 1 period. The risk free rate is 20%. Is there an arbitrage opportunity (free lunch)?

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Lectures On Corporate Finance

ISBN: B00RGENH5I

1st Edition

Authors: Peter L Bossaerts ,Bernt Arne Odegaard

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Question Posted: Oct 25, 2024 06:00 AM

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Options [4] Suppose a share of stock is trading at 30, a put with a strike of

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Lectures On Corporate Finance

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