The spot price of the market index is $900. After 3 months the market index is priced at $915. The annual rate of interest on treasuries is 2.4% (0.2% per month). The premium on the long put, with an exercise price of $930, is $8.00
Calculate the profit or loss to the short put position if the final index price is $915.
A) $15.00 gain
B) $15.00 loss
C) $6.95 gain
D) $6.95 loss
D
Business
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