Suppose that a stock paying no dividends in trading at 215


Suppose that a stock paying no dividends in trading at $21.5 a share. European puts on the stock with strike price $21 and exercise date in 6 months are trading at $3.12. The interest rate is r = 7%, compounded continuously. What is the price of a European call with the same strike price and exercise date?

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Financial Management: Suppose that a stock paying no dividends in trading at 215
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