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Corporate Finance · End Term · 21 Dec 2025 · September 2025 term

Question 12: A European put option with a strike price of Rs 90 is tr…

Question 12

+3 marksOne correct option

A European put option with a strike price of Rs 90 is trading at a price of Rs 5. The stock price is Rs 88, and the risk-free rate is 4% (continuously compounded) for the 1-year time to expiration. According to the put-call parity theorem, what is the corresponding European call option price (in Rupees)?

  1. A

    Rs 10.45

  2. B

    Rs 6.53

  3. C

    Rs 1.33

  4. D

    Rs 0.67

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Correct answer

  • B

    Rs 6.53

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Question 12 of 30 in the IIT Madras BS Corporate Finance (Corporate Finance) End Term paper sat on 21 Dec 2025, in the September 2025 term (Corporate Finance 18 Dec 25). It carries 3 marks.

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