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You own a lot in Key West, Florida, that is currently unused. Similar lots have...

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You own a lot in Key West, Florida, that is currently unused. Similar lots have recently sold for $1,310,000. Over the past five years, the price of land in the area has increased 5 percent per year, with an annual standard deviation of 31 percent. You have approached a buyer and would like the option to sell the land in 12 months for $1,460,000. The risk- free rate of interest is 5 percent per year, compounded continuously. What is the price of the put option necessary to guarantee your sales price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) * Answer is complete but not entirely correct. Price of put option S 129,849.27

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