What is the value of a put option with a strike price

Assignment Help Financial Management

Reference no: EM131354187

The price of a risk free bond with face value $12 and maturity one year is 0.5 dollars higher than the spot price of stock A. Also, a call option on stock A with a strike price $12 and maturity 1 year, has a premium of $0.21. What is the value of a put option with a strike price $12 and maturity 1 year?

Reference no: EM131354187

Questions Cloud

The depreciation tax shield is as risky as corporate debt : Your company has an expected net income of $250,000 for next year. It also has a constant debt of $2 million. The subsudized interest rate paid by the company is 2%, while the market interest rate is 3.50%. The unlevered return on equity is 7% and th..

Allocate the joint costs using the relative sales values : Landmark Coal operates a mine. During July, the company obtained 500 tons of ore, which yielded 250 pounds of gold and 63,400 pounds of copper. The joint cost related to the operation was $500,000. Gold sells for $325 per ounce and copper sells for $..

Pounds in the forward market are selling : The spot exchange rate is 1.57 dollars per pound. The 30-day forward exchange rate is .6211 pounds per dollar. Therefore, pounds in the forward market are selling at a ________ to the current spot rate.

German company issues bond with par value : Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. Suppose a German company issues a bond with a par value of €1,000, 15 years to maturity, and a coupon r..

What is the value of a put option with a strike price : The price of a risk free bond with face value $12 and maturity one year is 0.5 dollars higher than the spot price of stock A. Also, a call option on stock A with a strike price $12 and maturity 1 year, has a premium of $0.21. What is the value of a p..

Disregard self-employment taxes for kate : Determine the Sawyer's taxable income for 2016. Disregard self-employment taxes for Kate. Assume the couple paid $4,400 in state income taxes and files a joint return. The Sawyers would like to use the method for determining deductible home office ex..

Used interchangeably with occupational fraud : The term “white-collar crime” is often used interchangeably with occupational fraud. Some believe that investigations into white-collar crime are a low priority for law enforcement agencies. Why might this be true?

Different capital structures-what is price per share of plan : Haskell Corp. is comparing two different capital structures. Plan I would result in 11,000 shares of stock and $80,000 in debt. Plan II would result in 8,375 shares of stock and $150,000 in debt. The interest rate on the debt is 6 percent. Assume tha..

What price would you estimate for stock : Halliford Corporation expects to have earnings this coming year of $3.28 per share. Halliford plans to retain all of its earnings for the next two years. For the subsequent two? years, the firm will retain 49% of its earnings. It will then retain 19%..

User Account

All Pages