Put-Call-Futures Parity Is the Relationship Between the Prices of Puts,calls,and

question 51

Multiple Choice

Put-call-futures parity is the relationship between the prices of puts,calls,and futures on an asset.Assuming a constant risk-free rate and European options,which of the following correctly expresses the relationship of put-call-futures parity?

• A)Pe(S0,T)= Ce(S0,T)+ (X - f0(T))(1 + r)-T
• B)Pe(S0,T,X)= Ce(S0,T)- (X - f0(T))(1 + r)-T
• C)Pe(S0,T,X)= Ce(S0,T,X)+ (X - f0(T))(1 + r)-T
• D)Pe(S0,T,X)= Ce(S0,T,X)(X - f0(T))(1 + r)-T
• E)none of the above

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Definitions:

Sphygmomanometers

Instruments used to measure blood pressure, typically consisting of a cuff, gauge, and a mechanism for inflation.

Hyperpnea

An increased depth and rate of breathing, often in response to exercise or the body's need for more oxygen.

Aneroid Sphygmomanometers

A type of blood pressure monitor that uses a mechanical gauge without the need for mercury to measure blood pressure.