1. What is a financial option? What is the single most important characteristic of an option?
2. What is put-call parity?
Assume that you have just been hired as a financial analyst by Triple Trice Inc., a mid-sized California company that specializes in creating high-fashion clothing. Because no one at Triple Trice is familiar with the basics of financial options, you have been asked to prepare a brief report that the firm’s executives can use to gain at least a cursory understanding of the topic.