The Price of a European Call Option on RBC Stock

question 66

Multiple Choice

The price of a European call option on RBC stock with an exercise price of $85 and one year to expiry is trading at $3.15.The current price of the stock is $81.25,and the risk-free rate is 2.5%.With no arbitrage,what must be the price of a European put on RBC with an exercise price of $85?

• A)$4.83
• B)$3.15
• C)$1.47
• D)$4.71
• E)$2.59

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