Question
A stock is currently selling for $40.85. A 3-month call option with a strike price of $40 has an option premium of $1.30. The risk-free
A stock is currently selling for $40.85. A 3-month call option with a strike price of $40 has an option premium of $1.30. The risk-free rate is 2 percent and the market rate is 9.5 percent. What is the option premium on a 3-month put with a $40 strike price? Assume the options are European style. If the call option premium is $1.96 and the stock is currently selling for $41.49. What is the corresponding put option premium?
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Contemporary Issues In Development Finance
Authors: Joshua Yindenaba Abor, Robert Lensink, Charles Komla Delali Adjasi
1st Edition
1138324329, 978-1138324329
