Fight Finance

(a) $F_2=11.5027, V_0=0, V_{0.5}=1.5715$

(b) $F_2=11.5027, V_0=0, V_{0.5}=1.8258$

(c) $F_2=12.9693, V_0=0, V_{0.5}=1.3218$

(d) $F_2=12.9693, V_0=0, V_{0.5}=1.3896$

(e) $F_2=12.9693, V_0=0, V_{0.5}=1.6144$

(a) $F_1=110.5171, V_0=0, V_\text{0.5, SF}=14.7829$

(b) $F_1=110.5171, V_0=0, V_\text{0.5, SF}=15.1271$

(c) $F_1=99.8244, V_0=0, V_\text{0.5, SF}=14.7829$

(d) $F_1=99.8244, V_0=0, V_\text{0.5, SF}=20.5171$

(e) $F_1=99.8244, V_0=0, V_\text{0.5, SF}=9.9144$

Two put options are exactly the same, but one has a low and the other has a high exercise price. Which option would you expect to have the higher price, the option with the or exercise price, or should they have the price?

(a) Long the put only.

(b) Long the put and long the bond.

(c) Long the put and short the bond.

(d) Short the put and long the bond.

(e) Short the put and short the bond.

(a) Long call, long put and long bond.

(b) Long call, long put and short bond.

(c) Long call, short put and short bond.

(d) Short call, short put and short bond.

(e) Short call, long put and short bond.

(a) $N[d_1]$

(b) $N[d_2]$

(c) $−N[−d_1]$

(d) $−N[−d_2]$

(e) $N[−d_2]$

(a) P1median = $1.105171,   P1mean = $1.521962

(b) P1median = $1.1,             P1mean = $1.42

(c) P1median = $1.521962,   P1mean = $1.105171

(d) P1median = $0.802519,   P1mean = $1.105171

(e) P1median = $1.42,           P1mean = $1.1

(a) The geometric average of the gross discrete returns (GAGDR) equals 1.04075 which is 104.075%.

(b) $\exp \left( \text{GAGDR} \right) = \text{AALGDR}$. The natural exponent of the GAGDR equals the arithmetic average of the logarithms of the gross discrete returns (AALGDR).

(c) $\text{GAGDR}^T = \left( P_T/P_0 \right)$. The GAGDR raised to the power of the number of time period that it's measured over equals the ratio of the first and last prices.

(d) $\text{GAGDR} = \exp \left( \text{AALGDR} \right)$. This is always true, regardless of the distribution of the prices or returns. The logarithm of the geometric average of the gross discrete returns (LGAGDR) is always equal to the arithmetic average of the logarithm of the gross discrete returns (AALGDR).

(e) $\text{AAGDR} \approx \exp \left( \text{AALGDR} + \text{SDLGDR}^2/2 \right)$. This is only approximately true and depends on the distribution of the prices and returns. It's asymptotically true as the time period that the returns are measured over reaches infinity.

(a) Are a lender.

(b) Issued debt.

(c) Bought debt.

(d) Are a debt holder.

(e) Own a debt asset.