The Price of a European Call Option on Lululemon Stock

question 53

Multiple Choice

The price of a European call option on Lululemon stock with an exercise price of $34.50 and one year to expiry is trading at $2.52.The current price of the stock is $34,and the risk-free rate is 4%.With no arbitrage,what must be the price of a European put on Lululemon with an exercise price of $34.50?

• A)$3.37
• B)$0.71
• C)$1.69
• D)$2.52
• E)$0.50