Call option-what is current stock price

Assignment Help Financial Management
Reference no: EM131919577

A call option is currently selling for $5.30. It has a strike price of $60 and six months to maturity. A put option with the same strike price sells for $7.80. The risk-free rate is 4.3 percent, and the stock will pay a dividend of $2.80 in three months. What is the current stock price?

Reference no: EM131919577

Questions Cloud

What was inventory at the beginning of the year : ABC ended the year with inventory of 812,000. What was ABC's inventory at the beginning of the year?
Good results for the different ratios related to cash flow : what you would consider good results for the different ratios related to cash flow? Why or why not?
Futures contracts can be used to mitigate price risk : The maximum loss on a futures contract is the price paid for the contract. Futures contracts can be used to mitigate price risk.
Relations as function of common variable for alternative : Use an interest rate of 5% per year and the AW relations as function of common variable for each alternative.
Call option-what is current stock price : A call option is currently selling for $5.30. It has a strike price of $60 and six months to maturity. What is the current stock price?
Although bill has nothing saved for retirement : Although Bill has nothing saved for retirement so far, he has determined that he will need to have $722,000 in the account when he retires.
Cost of capital-weighted average cost of capital : What is the firm’s weighted average cost of capital (WACC2) if it has to issue new common stock?
What is the net present value of project : The company's weighted average cost of capital is 5.1%. What is the net present value of this project?
Cost of equity calculated without flotation adjustment : The difference between flotation-adjusted cost of equity and cost of equity calculated without flotation adjustment represents the flotation cost adjustment.

Reviews

Write a Review

Financial Management Questions & Answers

  High price multiples

High price multiples:

  Fixed payment coverage ratio

What is the "Fixed Payment Coverage Ratio?

  Compute the present value and yield to call

Compute the present value of a $2,000 deposit in year 1 and another $2,500 deposit at the end of year 4 using an 8 percent interest rate.

  Discount rate for discounted cash flow analyses for project

you should use 12% as the discount rate for the discounted cash flow (DCF) analyses for this new project.

  Net income-cost of goods sold-gross profit-retained earnings

Which statement will each of the following appear on Income statement, Balance sheet, or Neither? Net income. Cost of goods sold. Gross profit. Retained earnings. Paid-in capital in excess of par

  Calculate the total interest expense to be recorded

Smith & Sons, Inc., sold $100,000 face value, six percent coupon rate, four-year bonds, for an aggregate issue price of $96,000. Calculate the total interest expense to be recorded by the company over the four-year life of the bonds.

  What will be the value of your investment

Today you invested ?$29,400 in an investment that pays 8?% and will mature in 9 years. What will be the value of your investment after 15 ?years?

  Calculate the annual depreciation allowances

A piece of newly purchased industrial equipment costs $966,000 and is classified as seven-year property under MACRS. The MACRS depreciation schedule is shown in Table 10.7. Calculate the annual depreciation allowances and end-of-the-year book values ..

  Price and quality rate on consumers evaluation of products

What are the perceived strengths and weaknesses of our retail operations? What is the demographic profile of visitors to our website? How has the new packaging affected the sales of the product? How do price and quality rate on consumers’ evaluation ..

  Major investment-what is the internal rate of return

Franchising, Inc. is considering a major investment. What is the internal rate of return?

  Financial planner offers you two different investment plans

Your financial planner offers you two different investment plans. At what discount rate would you be indifferent between these two plans?

  Compute the payback statistic for project

Compute the Payback statistic for Project X and recommend whether the firm should accept or reject the project with the cash flows shown below.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd