Which put option must be written on the stock with greater price? Associate the 6% and both stocks pay no dividends.
Put T x standard deviations price
A 0.5 50 0.2 10
B 0.5 50 0.2 12
a) option A
b) option b
c) not enough information.
Which of the following statement is correct?
a) All else being equal, a put option on a high beta stock worth less than
b) all else being equal , a call option on a stock with a lot of firm- specific risk woth one on a stock with little firm - specific risk.
c) both a and b are correct
d) none of the statements are correct