Find the respective strike price of the call and put

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Question - Consider the Convertible Exchangeable Preferred issued by Microsoft, the terminal payoff structure is If $79.875 <= MSFT <= $102.24, the investor receives one share of MSFT. If MSFT <= $79.875, the investor receives the number of MSFT shares equivalent in value to $79.875. If MSFT >= $102.24, the investor receives the number of MSFT shares equivalent in value to $102.24. Show that the Preferred can be decomposed into one unit of stock, one put and one call. Find the respective strike price of the call and put.

Reference no: EM133008965

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