For the lookback call: a. What is the value of a lookback call as ST approaches zero?
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a. What is the value of a lookback call as ST approaches zero? Verify that the formula gives you the same answer.
b. Verify that at maturity the value of the call is ST − ST . Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...
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When using equation 2347 for the lookback call S t and 1 a I...View the full answer
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