The Current Price of a Stock Is $50

question 20

Multiple Choice

The current price of a stock is $50. Every month, the stock price will rise by a factor of 1.2 or fall by a factor of 0.8; and a $1 risk-free investment will be worth $1.03. A dividend as a proportion 0.01 of the stock price is paid each period. What is the price of a six-month American put option at a strike of $51?

• A) $7.51
• B) $7.91
• C) $8.11
• D) $8.51

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Definitions:

Diagnostic and Statistical Manual

The standard classification of mental disorders used by mental health professionals in the United States, providing diagnostic criteria for psychiatric diagnoses.

DSM-5

The Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition, a primary diagnostic tool for mental health professionals in the United States.

Current Edition

Refers to the most recent version or publication of a book, document, or standard, often implying improvements or updates from previous versions.

Mental Health Community

A broad term encompassing individuals living with mental health conditions, along with their caregivers and the professionals supporting them.