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Calculate the values of call and put options on the following stock: Time to maturity: 3 months Standard deviation: 70% per year Exercise price: $40

Calculate the values of call and put options on the following stock:

Time to maturity: 3 months

Standard deviation: 70% per year

Exercise price: $40

Stock price: $45

Interest rate: 5%

NOTE*** Requires formula and clearly defined step-by-step solution.

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