The price of a European call option on a non-dividend-paying stock with a strike price of...
The price of a European call option on a non-dividend-paying stock with a strike price of $50 is $6. The stock price is $51, the continuously compounded risk-free rate (all maturities) is 6% and the time to maturity is one year. What is the price of a one-year European put option on the stock with a strike price of $50?
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$2.09 |
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$7.52 |
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$3.58 |
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$9.91 |
Homework Answers
As per put call parity
Call Price + Strike Price*e^(-rt) = Put price + Stock Price
6+50*e^(-6%*1)=Put Price+51
Put Price =6+50*e^(-6%*1)-51
=2.09
Option a is correct option
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The price of a European call option on a non-dividend-paying
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