A Call Option on Juniper Corp

question 77

Multiple Choice

A call option on Juniper Corp. stock with an exercise price of $75 and an expiration date 1 year from now is worth $3 today. A put option on Juniper Corp. stock with an exercise price of $75 and an expiration date 1 year from now is worth $2.50 today. The risk-free rate of return is 8%, and Juniper Corp. pays no dividends. The stock should be worth ________ today.

• A) $69.73
• B) $71.69
• C) $73.12
• D) $77.25

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Definitions:

Ethical Soundness

The degree to which actions or decisions align with moral principles and ethical standards.

Developing Memory Skills

The process of improving the ability to encode, store, and retrieve information over time.

Cross-Sectional Design

A research design in which individuals of various ages are studied at the same time.

Cohort Differences

Variations in characteristics, experiences, or outcomes among groups of individuals born in different time periods, often studied in sociological and psychological research.