A stock with a current price of $67 has a put option available with a strike pri
ID: 2722008 • Letter: A
Question
A stock with a current price of $67 has a put option available with a strike price of $65. The stock will move up by a factor of 1.31 or down by a factor of .84 over the next period and the risk-free rate is 3 percent. What is the price of the put option? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)
A stock with a current price of $67 has a put option available with a strike price of $65. The stock will move up by a factor of 1.31 or down by a factor of .84 over the next period and the risk-free rate is 3 percent. What is the price of the put option? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)
Explanation / Answer
Put Option = Current Price-Strike Price
=67-65 = 2
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