A Call Option with 6 Months to Expiration Currently Sells

question 93

Multiple Choice

A call option with 6 months to expiration currently sells for $2.05. A put option with the same expiration sells for $.60. The options are European style. The risk-free rate is 3.0% and the strike price of both options is $50. What is the current stock price?

• A)$47.89
• B)$49.19
• C)$50.72
• D)$51.29
• E)$52.08

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Definitions:

Self-promotion

The act of highlighting one's own skills, achievements, or virtues, often to improve one's social standing or gain advantages.

Stable Self-esteem

A condition where an individual's confidence in their worth or abilities remains constant, despite external circumstances.

Self-compassion

Treating oneself with kindness, understanding, and forgiveness, especially in instances of pain or failure.

Mindfulness

The state of being and acting fully in the current moment.