A Stock Is Currently Selling for $65

question 24

Multiple Choice

A stock is currently selling for $65. There exists both a call option and a put option with a strike price of $65 and the same expiration date. Which of the following is true?

• A) The call price is always greater than the put price.
• B) The put price is always greater than the call price.
• C) The call and the put will have the same price.
• D) The call price will be greater than the put price only if the stock pays a dividend.
• E) None of the above.

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Definitions:

Credit Manager

A Credit Manager is a professional responsible for overseeing a company's credit policies, assessing creditworthiness, and managing credit lines.

Carrying Costs

The total cost of holding inventory, including storage, insurance, spoilage, and opportunity costs.

Shortage Costs

Costs incurred from not having enough inventory to meet demand, including lost sales and customer dissatisfaction.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or the normal operating cycle, whichever is longer.