Question
A stock is currently priced at $59. A call option with an expiration of 1 year has an exercise price of $65. The risk-free rate
A stock is currently priced at $59. A call option with an expiration of 1 year has an exercise price of $65. The risk-free rate is 65 percent per year, compounded continuously, and the standard deviation of the stock's return is infinitely large. What is the price of the call option?
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Fundamentals Of Corporate Finance
Authors: Berk, Peter DeMarzo, Jarrad Harford
3rd Global Edition
1292018402, 9781292018409
