Question
You are given the following alternative for a EUR 7,800 investment: either invest in a stock, whose price is S = EUR 26 per share,
You are given the following alternative for a EUR 7,800 investment: either invest in a stock, whose price is S = EUR 26 per share, or buy 3-month call options, Strike price X = EUR 30, that costs C = EUR 6 per option. What stock price at maturity would make both alternatives equivalent?
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Multinational Business Finance
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
10th Edition
0201785676, 9780201785678
