How much would you be willing to pay for a put on this stock

Assignment Help Financial Management
Reference no: EM131563106

In December 2014, a 9-month call on a stock, with an exercise price of $335, sold for $45.40. The stock price was $335. The risk-free interest rate was 6%. Assume that the stock options are European options. (Note: This stock does not pay a dividend.)

How much would you be willing to pay for a put on this stock with the same maturity and exercise price? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Price of a put

Reference no: EM131563106

Questions Cloud

Find the exact value of x : Find the exact value of x that is defined in terms of the continuing fraction at the right (the pattern continues endlessly). Explain your method of solution.
Solve for the company break-even point in unit sales : Solve for the company's break-even point in unit sales using the equation method. (Do not round your intermediate calculations.)
Prepare complete repayment schedule for this issue : Face value of the bonds is $500 each, and matures in 5 years. Prepare a complete repayment schedule for this issue.
What problems might be encountered : What are the legal guidelines? What problems might be encountered?When is a warrant necessary and why?In what ways can a defense attorney attack search ?
How much would you be willing to pay for a put on this stock : How much would you be willing to pay for a put on this stock with the same maturity and exercise price?
Mathematical discovery of all time was compound interest : Albert Einstein once remarked that the greatest mathematical discovery of all time was compound interest.
What would be the selling price of one unit of model : Njombe Corporation manufactures a variety of products. Under the traditional system, what would be the selling price of one unit of Model #36
Find the dimensions of the screen : The width of a rectangular TV screen is 22.9 in. longer than the height. If the diagonal is 60.0 in.
What was her internal rate of return over five year period : What was her internal rate of return over the five year period?

Reviews

Write a Review

Financial Management Questions & Answers

  Common stock and retained earnings accounts after dividend

Gordon's Meats has 6,500 shares of stock outstanding. The market value is $26.50 per share. The statement of financial position shows $48,200 in the common stock account, and $142,900 in the retained earnings account. The firm just announced a 5 perc..

  Current book value using straight line depreciation

Kenta Electronics purchased a manufacturing plant four years ago for $9,000,000. The plant cost $2.000,000 per year to operate. Its current book value using straight line depreciation is $7,000,000. Based on this information, should Kenta replace the..

  What is your opinion of this strategy

Some consumers might consider purchasing a new car with a car loan, while using credit cards to cover other purchases, and making only the minimum required payment to the credit card company each month. What is your opinion of this strategy?

  What are the flotation costs for issuing the preferred share

The preferred stock of Gator Industries sells for $34.63 and pays $2.77 per year in dividends. What is the cost of preferred stock financing? What are the flotation costs for issuing the preferred share and how should this cost be incorporated into t..

  What will be the value in your account at the end of year

Assume you are to receive a 30-year annuity with annual payments of $100. The first payment will be received at the end of Year 1, and the last payment will be received at the end of year 25. You will invest each payment in an account that pays 5.5 p..

  Speculators expect the spot rate of the yen

If speculators expect the spot rate of the yen in 60 days to be ____ than the 60-day forward rate on the yen, they will ____ the yen forward and put ____ pressure on the yen's forward rate. Fill in blanks

  Savings today and all contributions to savings are equal

he makes his first contribution to savings today and all contributions to savings are equal?

  Market price of share of common stock at time of issuance

The market price of a share of common stock at the time of issuance was $19.50, while the market price of a preferred share of stock at the time of issuance was $32. The company paid $12.50 for its treasury stock. Fill in the missing stockholders' eq..

  Calculate the cost-use of material sold for the material

Calculate the cost-use of material sold for the material(energy): Based on the following evaluation methods: - FIFO - HIFO - LIFO - average price

  Explain the importance of reports to an organization

Explain the importance of Reports to an organization. Who typically reads the reports, and what use is made of reports? Who is responsible for delivering the content of reports?

  The contract price will generate an aftertax cash flow

Hickock Mining is evaluating when to open a gold mine. The mine has 60,300 ounces of gold left that can be mined, and mining operations will produce 6,700 ounces per year. The required return on the gold mine is 11 percent, and it will cost $34.7 mil..

  Calculate the break-even volume

A regional soft drink manufacturer is considering opening a new manufacturing plant in the Midwest. Its total fixed costs are $100 million, with the cost of the new plant included in that figure at a depreciated value based on the expected life of th..

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