According to put/call parity
A) Stock price + Call Price = Put Price + Risk Free Bond Price
B) Stock price + Put Price = Call Price + Risk Free Bond Price
C) Put price + Call Price = Stock Price + Risk Free Bond Price
D) Stock price - Put Price = Call Price + Risk Free Bond Price
E) Stock price + Call Price = Put Price - Risk Free Bond Price

Question

Quizplus · Accepted Answer

Put/call parity states that the sum of the stock price and the present value of the exercise price of the put option is equal to the sum of the call option price and the present value of the risk-free bond. Mathematically, it can be shown as S + P = C + PV(K), where S is the stock price, P is the put option price, C is the call option price, and PV(K) is the present value of the exercise price. By rearranging this equation, we get S + P = C + PV(K), which is the same as choice B.

According to Put/call Parity