Maryam – The Risk Analyst at Bahrain Financial

Maryam, a risk analyst, is reviewing a defensive options strategy designed to protect a portfolio from a downside movement in a pharmaceutical stock. She is evaluating a European put option purchased by the client.

The contract details are as follows:

• Premium paid: $6.01

• Exercise (Strike) price: $185

Question:

Based on the terms of the contract, at what stock price at expiration would the investor break even on this put option investment?

(Ignore transaction costs. Round your answer to two decimal places.)