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Please answer every each sub questions. Thanks! 1. a). State the Put-Call Parity. b). Suppose the interest rate is r=.05 per year compounded continuously and

Please answer every each sub questions. Thanks!

1. a). State the Put-Call Parity.

b). Suppose the interest rate is r=.05 per year compounded continuously and the current value of an asset, S, is $100. Suppose P100 costs $5 with expiration date 1 year from now. How much is C100?

c). Suppose C100 costs $6 with expiration date 1 year from now. How much is P100?

d), What is the lower bound for C100? Compute C105P105,15months from now.

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