What is the price of put option

Assignment Help Financial Management
Reference no: EM131915434

Put-Call Parity.  A call option is currently selling for $3. It has a strike price of $65 and six months to maturity. What is the price of a put option with a $65 strike price and six months to maturity? The current stock price is $66, and the risk-free interest rate is 5 percent.

Reference no: EM131915434

Questions Cloud

Compute the depreciation charge : During 2013, Wenner Corp. uses the machinery for 2,650 hours, From the information given, compute the depreciation charge for 2013
What is expected return and standard deviation of portfolio : If Mary invests 100% of her portfolio wealth in the bond fund, what is the expected return and standard deviation of her portfolio?
Improve the firm overall balance of risk-return : it's relatively uncorrelated to the firm's other investments, may improve the firm's overall balance of risk/return.
Prepare a statement of revenues and expenditures : Prepare a Statement of Revenues, Expenditures, and Changes in Fund Balance for the debt service fund for the year ended December 31, 2011
What is the price of put option : What is the price of a put option with a $65 strike price and six months to maturity?
What is change in operating income for furniture divison : Question: What is the change in operating income for the Furniture Division? Round your answer to the nearest dollar, if required
Betas of the risk free asset and the market portfolio : Draw the security market line. Label all relevant points (the expected returns and betas of the risk free asset and the market portfolio).
Discuss how to access team productivity : DeRue, Barnes, and Morgeson (2010) found that team leadership style effectiveness depended on the level of charisma exhibited by the leader.
What are the tax consequences to terry : Assume the data are the same, except the fair market value of the property is $2,525,000. What are the tax consequences to Terry

Reviews

Write a Review

Financial Management Questions & Answers

  What is cost of preferred stock

Jensen's Travel Agency has 10 percent preferred stock outstanding that is currently selling for $34 a share. The market rate of return is 12 percent and the firm's tax rate is 34 percent. What is Jensen's cost of preferred stock?

  Manufacturing firm has just presented a decision tree

The VP of Sales for a manufacturing firm has just presented a decision tree for determining whether or not to conduct market research prior to introducing a new product to the US market. Ignoring the actual calculations, how do you evaluate such a pr..

  What is the break-even ebit for beta and gamma companies

Beta, Gamma, and Delta Companies are similar in every way except for their capital structures. Beta is an all-equity firm with $3,600,000 of value and 100,000 shares outstanding. Gamma is a levered firm with the same value as Beta, but $1,080,000 ..

  Compute the income tax and medicare contribution tax

Ms. Imo, who is single, purchased her first home in 1991 for $85,000, and sold it in May 2000 for $178,500. She purchased her second home in July 2000 for $385,000 and sold it this year for $700,000. a. Compute Ms. Imo's taxable gain on the 2000 sale..

  Find the market value of shares when dividends

Lawrence Industries' most recent annual dividend was $2.09 per share, and the firm's required return is 16%. Find the market value of Lawrence's shares when dividends are expected to grow at 20% annually for 3 years, followed by a 4% constant annual ..

  What is best estimate of the stock current intrinsic price

What is the best estimate of the stock's current intrinsic price? If the market price is $33 do you buy or sell?

  How much is interest earned on interest

Consider a $5,100 deposit earning 9 percent interest per year for 9 years. What is the future value? How much is interest earned on interest?

  Futures contract underlying the option matures

What is the delta of a short position in 4,000 European call options on gold futures? The options mature in eight months, and the futures contract underlying the option matures in nine months. The current nine-month futures price is $10 per ounce, th..

  Engaged to audit the financial statements

Harris Fell, CPA and member of the AICPA, was engaged to audit the financial statements of Wilson Corporation. Fell had half-completed the audit when he had a dispute with the management of Wilson Corporation and was discharged.

  Calculate the value of a share today

Nettle Inc. does not plan to pay a dividend for the next 5 years. Calculate the value of a share today (price).

  How many days is the days-sales-in-inventory

Goods available for sale total $25,000, beginning inventory is $8,000, endings inventory is $12,000, and cost of goods sold is $10,000. How many days is the days-sales-in-inventory?

  Started his own business to sell product he has developed

John has recently started his own business to sell a new product he has developed.

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