Problem

It is possible to buy three-month call options and three-month puts on stock Q. Both optio...

It is possible to buy three-month call options and three-month puts on stock Q. Both options have an exercise price of $60 and both are worth $10. If the interest rate is 5% a year, what is the stock price? (Hint: Use put-call parity.)

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Solutions For Problems in Chapter 20