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ABC stock is currently trading at $100. There are three-month European calls with strikes of 90, 100, and 110 available. The annualized rate of interest
ABC stock is currently trading at $100. There are three-month European calls with strikes of 90, 100, and 110 available. The annualized rate of interest applicable to all maturities is 5%. No dividends are expected on the stock over the next three months. The 100-strike call costs 10.52, while the 110-strike call costs 6.62. The best" lower bound of the price of the 90-strike call given this information is (a) zero. (b) 10. (c) 11.12. (d) 14.42
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