Question
The 1-year $42 options on Joy Company stock are priced at $1.78 for the call and $.75 for the put. The annual risk-free rate is
The 1-year $42 options on Joy Company stock are priced at $1.78 for the call and $.75 for the put. The annual risk-free rate is 4 percent. What is the per-share price of the underlying stock? (Hint: Use put-call parity to determine the share price)
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Money Banking And Financial Markets
Authors: Stephen Cecchetti, Kermit Schoenholtz
3rd Edition
007337590X, 9780073375908
