The Following Quotes Were Observed for Options on a Given

question 56

Multiple Choice

The following quotes were observed for options on a given stock on November 1 of a given year. These are American calls except where indicated. Use the information to answer questions 7 through 20.

The stock price was 113.25. The risk-free rates were 7.30 percent (November) , 7.50 percent (December) and 7.62 percent (January) . The times to expiration were 0.0384 (November) , 0.1342 (December) , and 0.211 (January) . Assume no dividends unless indicated.
-What is the intrinsic value of the November 105 put?

• A)0.30
• B)8.25
• C)8.50
• D)0.00
• E)none of the above

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Definitions:

One-sample Chi-square

A statistical test used to determine if a sample data matches a population with a specific distribution.

Goodness-of-fit Test

A statistical test used to determine how well observed data match the expected distribution or model.

Test of Independence

A statistical method used to determine whether two categorical variables are independent of each other.

Nonparametric Test

A different phrasing for nonparametric statistics, these are tests used for analyzing data when the assumptions for parametric tests cannot be met, focusing on the ranks or orders of the data.