The Current Price of YBM Stock S Is $101

question 4

Multiple Choice

The current price of YBM stock S is $101.European options with a strike price K = $100 and maturing in T = 6 months trade on YBM.The continuously compounded,risk-free interest rate r is 5 percent per year.If the call price c is $7.50 and the put price p is $4.60,then the arbitrage profits that you can make today by trading one contract of each option (one contract is based on 100 shares) are:

• A) 0
• B) $57
• C) $112
• D) $198
• E) None of these answers are correct.

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Definitions:

Mission Statement

A formal summary of the aims and values of a company, organization, or individual.

Operating Plans

Comprehensive outlines detailing a company's objectives and the strategies and processes to be implemented to achieve those objectives within a specific timeframe.

Fixed Assets

Fixed assets are long-term tangible assets that are used in the operations of a business and are not expected to be converted to cash in the near term.

Sales Growth Rate

The percentage increase in sales over a specific period, indicating the health and expanding nature of a business.