According to Put-Call Parity, a Put Option Can Be Replicated

question 81

Multiple Choice

According to put-call parity, a put option can be replicated by:

• A) buying a call, selling the underlying stock, and lending at the risk-free rate.
• B) selling a call, selling the underlying stock, and lending at the risk-free rate.
• C) buying a call, buying the underlying stock, and borrowing at the risk-free rate.
• D) selling a call, buying the underlying stock, and borrowing at the risk-free rate.
• E) buying a call, selling the underlying stock, and borrowing at the risk-free rate.

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Definitions:

Fresh Water

Water that is not salty, often found in rivers, lakes, and streams, and is essential for many forms of terrestrial life.

Distinct Zones

Separate or clearly different areas within a particular space or environment.

Northwestern Coast

A geographical term referring to the coastal areas located in the northwestern part of a continent or country, often characterized by specific climatic and ecological features.

North America

A continent entirely within the Northern Hemisphere and almost all within the Western Hemisphere.