What is the value of a 6-month put with a strike price of $27.25 given the Black-Scholes option pricing model and the following information? $$\begin{array} { l l }
\text { Stock price } & \$ 22.60 \
\text { Risk-free rate } & 3.5 \text { percent } \
6 \text {-month } \$ 27.50 \text { call } & \$ 1.46106
\end{array}$$
A)$4.71
B)$4.88
C)$5.24
D)$5.64
E)$6.62

Question

What is the value of a 6-month put with a strike price of $27.25 given the Black-Scholes option pricing model and the following information? $$\begin{array} { l l } 
\text { Stock price } & \$ 22.60 \
\text { Risk-free rate } & 3.5 \text { percent } \
6 \text {-month } \$ 27.50 \text { call } & \$ 1.46106
\end{array}$$
A)$4.71
B)$4.88
C)$5.24
D)$5.64
E)$6.62

Quizplus · Accepted Answer

P = ($27.25 × 2.71828^-0.035 ^{× 0.5}) + $1.46106 - $22.60 = $5.64

What Is the Value of a 6-Month Put with a Strike