The Put-Call Parity Theorem

question 29

Multiple Choice

The put-call parity theorem

• A)represents the proper relationship between put and call prices.
• B)allows for arbitrage opportunities if violated.
• C)may be violated by small amounts, but not enough to earn arbitrage profits, once transaction costs are considered.
• D)All of the options
• E)None of the options

---

Definitions:

Arbitrary

Decisions or actions not based on a system, principle, or rule and often appearing random or subject to individual will without restriction.

Future-Oriented

A perspective or approach that focuses on planning, forecasting, and preparing for upcoming changes, challenges, and opportunities.

Career Progression

Career progression involves the advancement or upward movement in one's professional life, through promotions, learning new skills, or changing roles.

Management-By-Objectives

A managerial strategy where employees and managers collaborate to set, monitor, and achieve specific objectives within an organization.