1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Aleks04 [339]
3 years ago
11

A put option on a stock with a current price of $46 has an exercise price of $48. The price of the corresponding call option is

$4.20. According to put-call parity, if the effective annual risk-free rate of interest is 4% and there are three months until expiration, what should be the price of the put?
Business
1 answer:
PIT_PIT [208]3 years ago
8 0

Answer:

$5.73

Explanation:

The computation of the price of the put is shown below:

= Price of the corresponding call option - current price of put option + exercise price ÷ ( 1 + effective annual risk-free rate of interest) ^ number of  months ÷ total months in a year

= $4.20 - $46 + $48 ÷ ( 1 + 0.04) ^ 3 months ÷ 12 months

= $4.20 - $46 + $48 ÷ 1.0098534065

= $4.20 - $46 + 47.5316513156

= $5.73

You might be interested in
How do corporations raise money and resources to expand? Select THREE answers.
Firlakuza [10]

Answer:

A. <u><em>They request a bank loan. </em></u>

D. <u><em>They agree to sell stocks. </em></u>

E. <u><em>They issue bonds. </em></u>

<u><em /></u>

Explanation:

your welcome

3 0
4 years ago
Read 2 more answers
Willing to give a lot of points
ivann1987 [24]

One of the reasons marketing is essential to the free market system is that It ensures that companies make a healthy profit.

<h3>What is free market?</h3>

A free market is a market structure where there is no interference from government but forces of demand and supply controls it.

With regards to the above, marketing ensures that products gets to the target audience to attract sales, thereby increase profits.

Learn more about free market here : brainly.com/question/13519121

#SPJ1

6 0
2 years ago
The key that determine economic growth?<br><br><br> Help me please !!
7nadin3 [17]
Gross Domestic Product (GDP)
6 0
3 years ago
What are the major elements of lvmh's competitive strategy in the branded luxury products industry? how well do the pieces fit t
Arada [10]
It's incorrect to say competitive strategy- because LVMH is not a business. LVMH doesnt compete with anyone because it is a conglomerate of decentralized brands. Each brand has its own DNA/story/value proposition and its own competitors and unique business strategies.

Having said that, LVMH's 'corporate' strategy is to hold a portfolio of the most cherished, coveted luxury brands and add value through its specialized resources - sourcing, its supply chain management, brand management and talent.
4 0
3 years ago
A nonprofit organization has generated a following of people who have created websites about the organization. Most of these sit
balandron [24]

Answer: b) By redirecting the URLs, those URLs will no longer rank independently on search engines, moving other (potentially negative) sites up higher in the rankings

Explanation:

The Non-profit Organization is shooting itself in the foot by purchasing the more positive sites and then setting them up in such a way that they will be redirected to their home page.

This is because when sites merely redirect, they lose their independence ranking. As this happens their place will be taken on search engines.

Seeing as the Nonprofit did this more with positive sites, there is a high chance that the sites that will replace those positive sites will be negative sites meaning that when people search for the Organization, they might see more negative information.

5 0
4 years ago
Other questions:
  • Kenny, Inc., is looking at setting up a new manufacturing plant in South Park. The company bought some land six years ago for $8
    15·1 answer
  • he Bread Company promotes its brand in new international markets by providing rights to local bakeries and bistros to use its re
    8·2 answers
  • Mcdonald's extra value meal is an example of bundle pricing, a frequently used ________________ practice.
    7·1 answer
  • Balance per books at October 31, $119,266.37; receipts $494,543.14; disbursements $469,946.59. Balance per bank statement Novemb
    6·1 answer
  • Which of the following is NOT an example that falls within the four major categories of business environment factors for today's
    9·1 answer
  • Ashock has been brought in as a consultant for a large organization. He is tasked with identifying the goals, policies, and acti
    15·1 answer
  • Inventory is an extra cost associated with the Aggregate Production Planning strategy of _____
    11·1 answer
  • Suppose Brian is in the market for a used textbook and the campus bookstore is having a sale. If the initial price of the used b
    5·1 answer
  • Bill is promoted to a position that has an elevated level of trust. He started with the organization in an entry-level position,
    9·1 answer
  • Esmerelda simplified a complex fraction. Her work is shown below.  What errors did Esmerelda make? Select three options. Esmere
    8·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!