Question
(a) Given that: Strike Call Premium 30 10 35 4 Risk-free interest rate is 3% p.a.. Which one is the strategy for you to capture
(a) Given that:
| Strike | Call Premium |
| 30 | 10 |
| 35 | 4 |
Risk-free interest rate is 3% p.a..
Which one is the strategy for you to capture the arbitrage profit?
a. Bull Spread
b. Bear Spread
c. Collar
d. There is no arbitrage opportunity.
(b) Given that:
| Strike | Put Premium |
| 100 | 4 |
| 102 | 6 |
Risk-free interest rate is 3% p.a.. The option matures in 1 year.
Which one is the strategy for you to capture the arbitrage profit?
a. Bull Spread
b. Bear Spread
c. Butterfly spread
d. There is no arbitrage opportunity
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Personal Finance Essentials Credit And Borrowing
Authors: Julia A Heath
1st Edition
1604139889, 9781604139884
