Consider a Pair of At-The-Money European Call and a Put

question 13

Multiple Choice

Consider a pair of at-the-money European call and a put options written on the same non-dividend-paying stock with the same maturity.Which of the following statements is most accurate?

• A)The minimum price of the call is at least as much as that of the put.
• B)The minimum price of the call is equal to that of the put.
• C)The minimum price of the call is less than that of the put.
• D)There is not enough information to decide.

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