Question
The price of a European call option on a dividend-paying stock with a strike price of $50 is $5. The stock price is $52, the
The price of a European call option on a dividend-paying stock with a strike price of $50 is $5. The stock price is $52, the continuously compounded risk-free rate (all maturities) is 4% and the time to maturity is one year.A dividend of $2 is expected in six months.What is the price of a one-year European put option on the stock with a strike price of $50?
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Introduction to Finance Markets, Investments and Financial Management
Authors: Ronald W. Melicher, Edgar A. Norton
16th edition
1119398282, 978-1-119-3211, 1119321115, 978-1119398288
