Question
a) A call option with a strike price of $68 on a stock selling at $82 costs $15.3. What are the call options intrinsic and
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a) A call option with a strike price of $68 on a stock selling at $82 costs $15.3. What are the call options intrinsic and time values?
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b) A put option on a stock with a current price of $37 has an exercise price of $39. The price of the corresponding call option is $2.85. According to put-call parity, if the effective annual risk-free rate of interest is 4% and there are three months until expiration, what should be the price of the put?
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c) A call option on Jupiter Motors stock with an exercise price of $75 and one-year expiration is selling at $6. A put option on Jupiter stock with an exercise price of $75 and one-year expiration is selling at $4.0. If the risk-free rate is 10% and Jupiter pays no dividends, what should the stock price be? show all steps and formula plz
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