Use the Table for the Question(s)below

question 44

Multiple Choice

Use the table for the question(s) below.
Consider the following information on options from the CBOE for Merck:
-Assume it is now January of 2007 and the current risk-free interest rate is 1%.Using Put-Call Parity and the January 30 option (ask price) ,estimate the relative contribution of the near-term dividends to the value of Merck's stock.

• A)$0.54
• B)$2.35
• C)$4.30
• D)$20.19

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Definitions:

Credibility

The quality of being trusted and believed in, often based on a reputation for honesty and integrity.

Appeal to Authority

A logical fallacy where the argument relies on the opinion or position of an authority figure instead of concrete evidence.

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The level of trustworthiness, expertise, and authority attributed to a person based on their knowledge or experience in a particular field.

Opponent

An individual or group who holds a position counter to one's own in a debate, argument, or competition.