Blues Inc. manufactures jeans in the cutting and sewing process. Jeans are manufactured in 40-jean batch sizes. The cutting time
1 answer:
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Answer:
p = $2.51
Explanation:
Given:
- D = $0.50
- Stock price: $29 (s)
- Interest rates: 10%.
- Strike price of $30 : $2 (c)
To find the the price of a European put option, we use here pit call parity that is :
c - p = s - k - D
<=> p = c - s + k + D
<=> p = 2 -29 + 30 + 0.5
<=> p = $2.51
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