Calculate the Price of a European Call Option If the Price

question 28

Multiple Choice

Calculate the price of a European call option if the price of the equivalent European put option is $5 and the share price,exercise price and risk-free rate (continuously compounded) are $31,$28 and 12% p.a. ,respectively.The options have three months to expiry.

• A)$1.17
• B)$8.83
• C)$8.82
• D)$9.63
• E)$1.18

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