Consider a six month put option on a stock with a strike, Finance Basics

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Consider a six month put option on a stock with a strike

Consider a six month put option on a stock with a strike price of $32. The current stock price is $30 and over the next six months it is expected to rise to $36 or fall to $27. The risk free rate is 6%.

a)What is the risk neutral probability p?

b)What is the hedge ratio of the put option?

Show work please

c)What is the put price?

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Finance Basics: Consider a six month put option on a stock with a strike

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Finance Basics: Consider a six month put option on a stock with a strike

Reference No:- TGS0605756

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

Q : Compute the cost of goods manufactured and cost of goods

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Request for Solution File

Ask an Expert for Answer!!

Finance Basics: Consider a six month put option on a stock with a strike

Reference No:- TGS0605756

Recent Questions Asked Finance Basics

Q : Compute the cost of goods manufactured and cost of goods

Q : A certain technique is known to have a mean of 0500 and

Q : An led with a rated range of vf 14 v to 18 v at if 20 ma

Q : The highest-energy cosmic ray ever detected had an energy

Q : Consider a six month put option on a stock with a strike

Q : A stock is currently priced at 100 over each of the next

Q : A square room has 3 mirrored walls of length l with one

Q : In use its arms are stretched to three times their original

Q : If the observed rate constant for the oxidation reaction at

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