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What is the value of the put option

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Reference no: EM133112677

1. Construct a synthetic security to mimic the following call option. Then find the value of this synthetic security (call option).

Stock price: $200

Exercise (Strike) price: $200

The stock price will either rise to $300 or fall to $125 at the end of one year.

Risk free rate: 4% annual

Option life: 6 months

2. What is the value of the put option, given the above call option value?

Reference no: EM133112677

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