A Futures Price Is Currently 40 Cents

question 2

Multiple Choice

A futures price is currently 40 cents.It is expected to move up to 44 cents or down to 34 cents in the next six months.The risk-free interest rate is 6%.What is the value of a six-month put option with a strike price of 37 cents?

• A) 3.00 cents
• B) 2.91 cents
• C) 1.16 cents
• D) 1.20 cents

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Definitions:

Sodium

A chemical element (Na) that is a soft, silver-white, highly reactive metal belonging to the alkali metal group, essential for humans and animals in small amounts.

Acid-Base Balance

The mechanism by which the body maintains its normal pH level, ensuring optimal functioning of cells and organs.

Fluid Balance

The maintenance of the correct amount of fluid in the body, crucial for ensuring that all cells and organs function effectively.

Clear-Liquid Diet

A diet consisting only of clear liquids like water, broth, and certain juices, often recommended before medical tests or surgery.