Consider a Firm Viewed in Terms of Put Options

question 13

Multiple Choice

Consider a firm viewed in terms of put options.Given this view,which one of these statements is correct?

• A)Stockholders sold a put on the firm to the bondholders.
• B)Bondholders own the firm.
• C)Bondholders and stockholders co-own the firm in equal shares.
• D)Bondholders wrote a put on the firm to the stockholders.
• E)The stockholders' position is equal to the value of the firm plus the value of the put.

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