Multiple Choice
It can be shown that the put-call parity relationship for options where the underlying asset makes cash distributions and where the time value of money is recognized is: Put option price - Call option price = ________.
A) Present value of strike price - Present value of cash distribution + Price of underlying asset
B) Present value of strike price + Future value of cash distribution - Price of underlying asset
C) Present value of strike price + Present value of cash distribution - Price of underlying asset
D) Future value of strike price + Present value of cash distribution - Price of underlying asset
Correct Answer:
Verified
Correct Answer:
Verified
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