A Stock with a Price of $72 Has a Dividend

question 17

Multiple Choice

A stock with a price of $72 has a dividend yield of 1 percent. There is a put option on the stock with a strike price of $75 that sells for $7.28 and has 49 days to maturity. If the risk-free rate is 5 percent, what is the implied standard deviation of the stock?

• A) 48.27%
• B) 55.06%
• C) 42.86%
• D) 30.15%
• E) 37.29%

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