Compute the price of the put with the same strike

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Rebecca is interested in purchasing a European call on a hot new? stock, Up, Inc. The call has a strike price of $99.00 and expires in 85 days. The current price of Up stock is $122.83?, and the stock has a standard deviation of 35% per year. The? risk-free interest rate is 6.95% per year. Up stock pays no dividends. Use a? 365-day year.

Problem a. Using the? Black-Scholes formula, compute the price of the call.

Problem b. Use? put-call parity to compute the price of the put with the same strike and expiration date.

Reference no: EM133010412

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