Question
The price of a European call option on a stock with a strike price of $50 is $6. The stock price is $51, the continuously
The price of a European call option on a stock with a strike price of $50 is $6. The stock price is $51, the continuously compounded risk-free rate (all maturities) is 6% and the time to maturity is one year. A dividend of $1 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? Please show your work.
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Financial Management Principles And Practice
Authors: Timothy J. Gallagher, Joseph D. Andrew
3rd Edition
0131768824, 978-0131768826
