Exhibit 20 -Refer to Exhibit 20

question 43

Multiple Choice

Exhibit 20.6
Use the Information Below for the Following Problem(S)
The current stock price of ABC Corporation is $53.50. ABC Corporation has the following put and call option prices that expire 6 months from today. The risk-free rate of return is 5% and the expected return on the market is 11%.
$$\begin{array} { c c c } \text { Exprcisp Price } & \text { Put Price } & \text { Call Price } \\50 & \$ 1.50 & \$ 5.75 \\55 & \$ 3.25 & \ldots\end{array}$$
-Refer to Exhibit 20.6.What is the value of a synthetic stock created with put and call options that expire in 6 months with an expiration price of $50?

• A) $53.04
• B) $53.53
• C) $54.54
• D) $55.03
• E) $56.23

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Definitions:

Brym And Lie

Authors known for their contributions to sociology, particularly in creating accessible textbooks and materials that explain sociological concepts and theories.

Overestimate

To assess something as greater or more significant than it actually is.

Hidden Curriculum

The unofficial and unintended lessons, values, and perspectives that students learn in school beyond the formal curriculum.

Plastic

Synthetic materials made from a wide range of organic polymers that can be molded into shape while soft and then set into a rigid or slightly elastic form.