Question
A stock is currently priced at $51. A call option with an expiration of 1 year has an exercise price of $55. The risk-free rate
A stock is currently priced at $51. A call option with an expiration of 1 year has an exercise price of $55. The risk-free rate is 4 percent per year, compounded continuously, and the standard deviation of the stocks return is infinitely large. What is the price of the call option?
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Finance For A Better World
Authors: Henri-Claude De Bettignies, F. Lépineux
2009th Edition
0230551300, 978-0230551305
