1. The stock of the McCall Corporation is currently trading at $42 per share. The stocks volatility as measured by its standard deviation is 20%. If the strike (exercise) price for a certain set of options on McCall stock carry a strike price of $40, and the options run for 6 months (180 days), determine the Black-Scholes model values for:N (d1), N (d2), N (- d1), and N (- d2). (Assume the risk-free rate is 10% and that the stock pays no dividends.)

2. Given the information in question one (1) above and your calculated values for N(d1), N (d2), N (- d1), and N (- d2), determine:

a. The price (premium) one must pay for a call option (Ct) on McCall stock using the Black-Scholes model.

b. How much of the calls value is composed of intrinsic value? How much of the calls value is composed of a time premium? (Explain how you determined these values.)

3. Given the information in question one (1) above and your calculated values for N(d1), N (d2), N (- d1), and N (- d2), determine

:a. The price (premium) of a put option (Pt) for McCall stock using the BlackScholesmodel. (Use the put/call parity model to confirm your answer.)

b. How much of the puts value (price) is composed of intrinsic value? How much of the puts value is composed of a time premium? (Explain how you determined these values.)

Hi please show the working done in order to answer these questions. WITHOUT the use of excel or I am afraid I cannot accept the answer. Thank you.