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Corporate Finance · End Term · 10 May 2026 · January 2026 term · Set 1-2

Question 27: The price of a six-month European put option on a non-di…

Question 27

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The price of a six-month European put option on a non-dividend-paying stock with a strike price of Rs 450 is Rs 30. The stock price is Rs 430, and the annual risk-free rate is 10% (continuously compounded). What is the price of a six-month European call option on the same stock with a strike price of Rs 450? (Round off to the nearest integer)

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Correct answer: 32 (accepted within ±1)

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Question 27 of 35 in the IIT Madras BS Corporate Finance (Corporate Finance) End Term paper sat on 10 May 2026, in the January 2026 term (Corporate Finance 06 May 26). It carries 4 marks.

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