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Corporate Finance · End Term · 13 Apr 2025 · January 2025 term

Corporate Finance End Term 13 Apr 2025 — Question 29

Question 29

+4 marksOne or more correct options

The put-call parity states that

Select all that apply.

  1. A

    The price of a European put option must equal the European call option price plus the present value of the strike price minus the stock price.

  2. B

    The price of a European call option must equal the European put option price plus the present value of the strike price minus the stock price.

  3. C

    The price of a European put option must equal the European call option price plus the stock price minus the present value of the strike price.

  4. D

    The price of a European call option must equal the European put option price plus the stock price minus the present value of the strike price.

Show answer

Correct answers

  • A

    The price of a European put option must equal the European call option price plus the present value of the strike price minus the stock price.

  • D

    The price of a European call option must equal the European put option price plus the stock price minus the present value of the strike price.

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Question 29 of 35 in the IIT Madras BS Corporate Finance (Corporate Finance) End Term paper sat on 13 Apr 2025, in the January 2025 term (IIT M IMPROVEMENT AN EXAM QIM3 13 Apr 2025). It carries 4 marks.

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