A Stock Is Selling for $60 Per Share

question 18

Multiple Choice

A stock is selling for $60 per share.A call option with an exercise price of $65 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)$5.99
• B)$6.23
• C)$6.47
• D)$7.21
• E)$8.94

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Definitions:

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