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Assume that the risk-free interest rate is positive. Using put-call parity, show that it is never optimal to exercise an American call option on a
Assume that the risk-free interest rate is positive. Using put-call parity, show that it is never optimal to exercise an American call option on a non-dividend paying stock early. Explain what you think is the intuition behind this result (i.e. why is it optimal to wait?).
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