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put-call parity theorem

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2. Using the put-call parity theorem, determine the value of a T period put of the stock described in problem 1 with an exercise price of $110.

I ONLY NEED PROBLEM 2 TO BE SOLVED.

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1. You observe that a stock is currently selling for $100. Somehow you know that the two possible values for the stock at time T are $80 and $130. You also observe that (1+r)T = 1.1. You don't know the probabilities of the two states of the world occurring. ...

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The put-call parity theorem is utilized.

$2.19
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present value of growth opportunities

1. The market consensus is that Analog Electronic Corporation has an ROE = 12%, a beta of 1.25, and it plans to maintain indefinitely its traditional plowback ratio of 2/3. This year's earnings were $3 per share. The annual dividend was just paid. The consensus estimate of the coming year's market return is 14% and T-bills currently offer a 6% return.

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