As a member of the CED, would you continue to approve CPRs if it meant that Target would need to fund their requests with external funds, either debt or equity?
The stock price of QCorp today is $150. A one-year call on this stock with an exercise price of $160 is trading at a price of $2. (a) If the risk-free rate is 6% p.a., what should be the price of a comparable put? (b) Suppose the market price of the put is actually $1.75, detail the transactions you would undertake to make an arbitrage profit and compute the profit.