Question
8. Suppose that you have the following prices: call price = $2.95, K=28, S 0 = 30, t =2, r f = 2%, Dividend=0. Is
8. Suppose that you have the following prices: call price = $2.95, K=28, S0 = 30, t =2, rf = 2%, Dividend=0. Is there an arbitrage opportunity? Show your calculation and describe the available profit (or describe why there is no easy arbitrage). (6 points)
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International financial management
Authors: Jeff Madura
12th edition
1133947832, 978-1305195011, 978-1133947837
