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Management Studies

Which one of the following statements is correct?

a. Value of put + present value of exercise = value of call + share price.

b. Value of put + share price = value of call + present value of exercise price.

c. Value of put - share price = present value of exercise price - value of call.

d. Value of put + value of call = share price - present value of exercise price.

The correct statement equates the value of two investment strategies. Plot the payoffs to each strategy as a function of the stock price. Show that the two strategies give identical payoffs.

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Business Management, Management Studies

Category:- Business Management
Reference No.:- M9210144

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