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Rob wishes to buy a European put option on BioLabs, Inc., a non-dividend paying common stock, with a strike price of $50 and six months
Rob wishes to buy a European put option on BioLabs, Inc., a non-dividend paying common stock, with a strike price of $50 and six months until expiration. The company's common stock is currently selling for $34 per share and Rob expects that the stock price will either rise to $68 or fall to $19 In six months. Rob can borrow and lend at the risk- free EAR of 4 percent. 0.5 points ebook a. What should the put option sell for today? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 3216.) b. What is the delta of the put? (A negative answer should be indicated by a minus sign. Do not round Intermediate calculations and round your answer to 2 decimal places, e.g. 3216.) C. How much would Rob have to lend to create a synthetic put? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g.. 32.16.) d. How much does the synthetic put option cost? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Print References a. Put option price b. Put delta c. Amount to lend d. Option price Rob wishes to buy a European put option on BioLabs, Inc., a non-dividend paying common stock, with a strike price of $50 and six months until expiration. The company's common stock is currently selling for $34 per share and Rob expects that the stock price will either rise to $68 or fall to $19 In six months. Rob can borrow and lend at the risk- free EAR of 4 percent. 0.5 points ebook a. What should the put option sell for today? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 3216.) b. What is the delta of the put? (A negative answer should be indicated by a minus sign. Do not round Intermediate calculations and round your answer to 2 decimal places, e.g. 3216.) C. How much would Rob have to lend to create a synthetic put? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g.. 32.16.) d. How much does the synthetic put option cost? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Print References a. Put option price b. Put delta c. Amount to lend d. Option price
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