What is the value of a put option written on the stock

Assignment Help Financial Accounting
Reference no: EM132619741

Problem 1: The current price of a stock is $33, and the annual risk-free rate is 6%. A call option with a strike price of $32 and with 1 year until expiration has a current value of $6.56. What is the value of a put option written on the stock with the same exercise price and expiration date as the call option?

Reference no: EM132619741

Questions Cloud

What adjustments would need to be made to the financial : What adjustments would need to be made to this financial information to be in a form consistent with residual cash flows for undertaking time value of money
Explain the term bank reconciliation : Explain the term "bank reconciliation" and state the reasons for its preparation. Make A bank reconciliation statement as at 31st October 2018
Can goal of maximizing the value of the equity shares : Can our goal of maximizing the value of the equity shares conflict with other goal, such as avoiding unethical or illegal behavior?
Do think subjects like customer and employee safety : Do think subjects like customer and employee safety, environment and general good of society fit in this framework, or are they essentially ignored?
What is the value of a put option written on the stock : The current price of a stock is $33, What is the value of a put option written on the stock with the same exercise price and expiration date as the call option?
Explain the enhancing qualitative characteristics : Identify and explain the enhancing qualitative characteristics of good accounting information for decision making
What is the options value : According to the Black Scholes option pricing model, what is the options's value? Assume that you have been given the information on Purcell Corporation
What are Red Ox net cash inflows from financing activities : Red Ox declared a dividend of $16,000 that is to be paid on January 4, 20X5. What are Red Ox's net cash inflows from financing activities for 20X4 fiscal year
Find what are option market value and the price of the stock : Flanagan Company's call option is $15, its exercise value is $22, and its time value is $5. What are the option's market value and the price of the stock?

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

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