Financial Risk Manager Part 1

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Explanation:

Use put-call parity for a dividend-paying stock:

c + K e^{-rT} + D = p + S_0

Solve for the put price:

p = c + K e^{-rT} + D - S_0

Where the present value of dividends is:

D = 1e^{-0.04(1/12)} + 1e^{-0.04(4/12)} = 1.983472

Now compute:

p = 5 + 60e^{-0.04(0.5)} + 1.983472 - 60

p \approx 5.7953

So the closest answer is B. $5.80.

Explanation:

Use put-call parity for a dividend-paying stock:

c + K e^{-rT} + D = p + S_0

Solve for the put price:

p = c + K e^{-rT} + D - S_0

Where the present value of dividends is:

D = 1e^{-0.04(1/12)} + 1e^{-0.04(4/12)} = 1.983472

Now compute:

p = 5 + 60e^{-0.04(0.5)} + 1.983472 - 60

p \approx 5.7953

So the closest answer is B. $5.80.

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MManit

Last updated: April 18, 2026 at 11:32

$3.81

100.0%

$5.80

0.0%

$5.96

$6.04