Assuming XYZ is a dividend paying stock and the the dividend yield compounded continuously per annum is
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Assuming XYZ is a dividend paying stock and the the dividend yield compounded continuously per annum is set to be 0.001 in b, whereas the dividend yield in a= 0.00 .
comment on the difference in the results in (a) and (b)?
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Assuming XYZ is a dividend paying stock and the the dividend yield compounded continuously per annum is set to be 0.001. Repeat (a) and comment on the difference in the results in (a) and (b). In years d2 1 -0.19107186 -0.49107186 0.42423465 2 0.15951962 -0.26474445 0.56337025 M 2.86033105 0.73901071 0.99788401 4.10589281 1.10589281 500 9.28977101 2.58156708 N(d2) Call price 0.31168781 7.89657102 0.39560317 15.8837311 5 0.65990606 -0.01091433 0.74534294 0.4956459 34.6653285 56.237666 0.77004975 98.0959261 0.99997986 0.86561354 99.9631405 1 0.99508236 Time to matu d1 10 1.1254319 0.1767486 0.86979697 0.57014707 50 100 Given divident y=0,001 In years Time to matu d1 N(D1) d2 2(b) N(D1) Call price 1 -0.19440519 -0.49440519 0.42292931 0.31051002 7.85423399 2 0.15480558 -0.26945849 0.5615127 0.39378844 15.7713552 5 0.6524525 -0.01836789 0.74294535 0.49267268 34.2941841 10 1.11489097 0.16620767 0.86755143 0.56600324 55.3733167 50 2.83676082 0.71544048 0.99772131 0.76283155 93.2295774 100 4.07255948 1.07255948 0.99997675 0.85826559 90.4470882 500 9.21523541 2.50703148 1 0.99391251 60.653066 100 N(d2) Assuming XYZ is a dividend paying stock and the the dividend yield compounded continuously per annum is set to be 0.001. Repeat (a) and comment on the difference in the results in (a) and (b). In years d2 1 -0.19107186 -0.49107186 0.42423465 2 0.15951962 -0.26474445 0.56337025 M 2.86033105 0.73901071 0.99788401 4.10589281 1.10589281 500 9.28977101 2.58156708 N(d2) Call price 0.31168781 7.89657102 0.39560317 15.8837311 5 0.65990606 -0.01091433 0.74534294 0.4956459 34.6653285 56.237666 0.77004975 98.0959261 0.99997986 0.86561354 99.9631405 1 0.99508236 Time to matu d1 10 1.1254319 0.1767486 0.86979697 0.57014707 50 100 Given divident y=0,001 In years Time to matu d1 N(D1) d2 2(b) N(D1) Call price 1 -0.19440519 -0.49440519 0.42292931 0.31051002 7.85423399 2 0.15480558 -0.26945849 0.5615127 0.39378844 15.7713552 5 0.6524525 -0.01836789 0.74294535 0.49267268 34.2941841 10 1.11489097 0.16620767 0.86755143 0.56600324 55.3733167 50 2.83676082 0.71544048 0.99772131 0.76283155 93.2295774 100 4.07255948 1.07255948 0.99997675 0.85826559 90.4470882 500 9.21523541 2.50703148 1 0.99391251 60.653066 100 N(d2)
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Comparing Results with Different Dividend Yields Scenario a Dividend Yield 000 In this scenario the ... View the full answer
Related Book For
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
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