Solved

Assume the Following: LN(S)and LN(Q)have a Correlation Coefficient of -0 QS\sqrt{Q S}

Question 1

Multiple Choice

Assume the following: LN(S) and LN(Q) have a correlation coefficient of -0.20,S(0) = 45,S(Q) = 55,r = 0.03,σs = 0.18 σQ = 0.28,and no dividends.Using formula 20.39,what is the price of a claim that pays 1/ QS\sqrt{Q S}
?


A) $3.02
B) $2.02
C) $1.02
D) $0.02

Correct Answer:

verifed

Verified

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents