Question
A. Dynamic Energy Systems stock is currently trading for $33 per share. The stock pays no dividends. A one-year European put option on Dynamic with
A. Dynamic Energy Systems stock is currently trading for $33 per share. The stock pays no dividends. A one-year European put option on Dynamic with a strike price of $40 is currently trading for $7.33. If the risk-free interest rate is 11% per year, what is the price of a one-year European call option on Dynamic with a strike price of $40?
B.Suppose Amazon stock is trading for $455 per share, and Amazon pays no dividends.
a. What is the maximum possible price of a call option on Amazon?
b. What is the maximum possible price of a put option on Amazon with a strike price of$ 510?
c. What is the minimum possible value of a call option on Amazon stock with a strike price of $ 430?
d. What is the minimum possible value of an American put option on Amazon stock with a strike price of $ 495
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