AFP
CTP · Question #223
(Topic 3) What is the premium (price) for an oil contract, if the following conditions are present? LIBOR rate of 5% Out of the money cost of $3 Strike price is $4 In the money price of $1…
The correct answer is C. $7. See the full explanation below for the reasoning.
Question
- (Topic 3)
What is the premium (price) for an oil contract, if the following conditions are present? LIBOR rate of 5% Out of the money cost of $3 Strike price is $4 In the money price of $1 Speculative premium of $2
Options
- A$3
- B$5.25
- C$7
- D$7.35
How the community answered
(34 responses)- A3% (1)
- B12% (4)
- C79% (27)
- D6% (2)
Community Discussion
No community discussion yet for this question.