Problema put option that expires in six months with an, Ask an Expert

Accounting

Problem:

A put option that expires in six months with an exercise price of $35 sells for $4.70. The stock is currently priced at $31, and the risk-free rate is 4.4 percent per year, compounded continuously.

Required:

Question: What is the price of a call option with the same exercise price?

Note: Provide support for rationale.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91167285

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