Suppose a stock price can go up by 15 or down by 13 over


Suppose a stock price can go up by 15% or down by 13% over the next year. You own a one-year put on the stock. The interest rate is 10%, and the current stock price is $60.

a. What exercise price leaves you indifferent between holding the put or exercising it now?

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Accounting Basics: Suppose a stock price can go up by 15 or down by 13 over
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