Suppose you look in the newspaper and see ABC trading at $50 per share. Calls on ABC

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Suppose you look in the newspaper and see ABC trading at $50 per share. Calls on ABC with one month to expiration and an exercise price of $45 are trading at $6.50 each. Puts on ABC with one month to expiration and an exercise price of $55 are trading at $3.00 each. Are these prices reasonable? Explain. (Ignore transactions costs.)

Posted Date: May 19, 2024 12:08 PM

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Suppose you look in the newspaper and see ABC trading at $50 per share. Calls on ABC

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