Question
Imagine that Google has a probability of 80% to increase by 10 % and a probability of 20% to fall by 10% over the next
Imagine that Google has a probability of 80% to increase by 10 % and a probability of 20% to fall by 10% over the next month. Apple, on the other hand, has a probability of 20% to increase by 20% and a probability of 80% to fall by 20 %. Compare the price of Call option on Google and Apple, both with the same strike and expiry in one month.
O Apple Call will be more expansive than Google Call Google Call will be equally expansive than Apple Call
O Google Call will be more expansive than Apple Call
O For strike below the current spot: Google Call will be equally expansive than Apple Call
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Professional Android 4 Application Development
Authors: Reto Meier
3rd Edition
1118223853, 9781118223857
