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Business, 12.04.2021 19:20 michelle7511

The common stock of Fincorp has been trading in a narrow price range for the past month, and you are convinced it is going to break far out of that rang in the next 3 months. You do not know whether it will go up or down, however. The current price of the stock is $7.45 per share while the price of a 3-month call option is $0.47 with an exercise price of $7.50. (a) If the risk-free interest rate is 2% per year, what must be the price of a 3-month put option on Fincorp at an exercise price of $7.50

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