An American Put Option, with an Exercise Price of $15

question 348

True/False

An American put option, with an exercise price of $15, sells for $7.50; the stock price is $6 presents an arbitrage opportunity. (Assume no transaction costs and any option can be exercised immediately).

---

Definitions:

NFPA

The National Fire Protection Association, an organization that develops and publishes fire safety and prevention standards, including codes for building construction and protection systems.

Paralegal Association

An organization or group that represents the interests of paralegals, providing resources, education, and advocacy.

California

A state located on the west coast of the United States, known for its diverse geography, climate, and the entertainment industry centered in Hollywood.

Paralegal Education

Formal education and training designed to prepare individuals for careers as paralegals, providing knowledge of legal concepts, research and writing skills.