Under European Put-Call Parity,the Present Value of the Strike Price

question 76

Multiple Choice

Under European put-call parity,the present value of the strike price is equivalent to:

• A)the current value of the stock minus the call premium.
• B)the market value of the stock plus the put premium.
• C)the present value of a government coupon bond with a face value equal to the strike price.
• D)a U.S. Treasury bill with a face value equal to the strike price.
• E)a risk-free security with a face value equal to the strike price and a coupon rate equal to the risk-free rate of return.

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