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A one year option contract on Cheesy Poafs Co. stock sells for $845. In one year, the stock will be worth $64 or $81 per
A one year option contract on Cheesy Poafs Co. stock sells for $845. In one year, the stock will be worth $64 or $81 per share. The exercise price on the call option is $70. What is the current value of the stock if the risk-free rate is 3%. (the option contract is for 100 shares. Find the current value of the stock. Please show your calculations so I can understand how to do similar problems.
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