A Stock Is Selling for $60 Per Share

question 45

Multiple Choice

A stock is selling for $60 per share. A call option with an exercise price of $67 sells for $3.31 and expires in 4 months. The risk-free rate of interest is 2.8 percent per year, compounded continuously. What is the price of a put option with the same exercise price and expiration date?

• A)$8.99
• B)$9.23
• C)$9.47
• D)$9.69
• E)$9.94

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Definitions:

Crowdsourcing

The process of obtaining needed services, ideas, or content by soliciting contributions from a large group of people, especially from an online community.

Analytics

The systematic computational analysis of data or statistics to discover patterns, trends, or insights.

Company

A legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise.

Crowdsourcing

The practice of obtaining information, ideas, or content by soliciting contributions from a large group of people, typically from the online community, rather than from traditional employees or suppliers.