Put Lower Bound [5] Show that the following is an lower bound on a put price Pt

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Put Lower Bound [5]

Show that the following is an lower bound on a put price Pt

~ (H-r)C-t ) " S '

where Pt is the current put price, K is the exercise price, r is the risk free interest rate, (T — t) is the time to maturity and St is the current price of the underlying security.

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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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Put Lower Bound [5] Show that the following is an lower bound on a put price Pt

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Lectures On Corporate Finance

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