Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The NYGHS stock is worth $130 today. A call option on NYGHS stock with a strike price of $150 and an expiration date 6 months

The NYGHS stock is worth $130 today. A call option on NYGHS stock with a strike price of $150 and an expiration date 6 months from now is worth $50 today. The risk-free rate of return is 3.5%, and the stock pays no dividends. According to put-call parity, a put option on NYGHS stock with a strike price of $150 and an expiration date 6 months from should be worth ______ today? (Use continuous compounding interest rate)?

$66.11

$67.03

$67.40

$77.22

None of the above

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Short Term Financial Management

Authors: Ned C. Hill, William L. Sartoris

3rd Edition

0023548320, 978-0023548321

More Books

Students also viewed these Finance questions