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1. You are given the following: ✓ The current price to buy one share of XYZ stock is $600. ✓ The stock does not pay divi
Posted: Sun May 29, 2022 8:26 pm
by answerhappygod
- 1 You Are Given The Following The Current Price To Buy One Share Of Xyz Stock Is 600 The Stock Does Not Pay Divi 1 (27.97 KiB) Viewed 17 times
1. You are given the following: ✓ The current price to buy one share of XYZ stock is $600. ✓ The stock does not pay dividends. ✓ The continuously compounded risk-free rate is 5% per annum. A European call option on one share of XYZ stock with a strike price of K that expires in one year costs $55. ✓ A European put option on one share of XYZ stock with a strike price of K that expires in one year costs $26. Using put-call parity, calculate the strike price, K.