A Call Option with 2 Months to Expiration Currently Sells

question 128

Multiple Choice

A call option with 2 months to expiration currently sells for $3.80. A put option with the same expiration sells for $1.30. The options are European style. The risk-free rate is 5 percent and the strike price of both options is $62.50. What is the current stock price?

• A) $60.70
• B) $72.07
• C) $67.16
• D) $64.49
• E) $70.23