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In the question below I am getting 5.79585 as d1 ? Am I doing something wrong? No matter what I do it is not matching
In the question below I am getting 5.79585 as d1? Am I doing something wrong? No matter what I do it is not matching up to the answer for d1 below of 5.2655. Can someone verify d1 and the answer to the question below?
Shirtco stock is currently valued at 8 per share.Find the price of a 6 month call with an exercise price of 7.Shirtco's variance is .04.Rf rate is 3%.
Answer:
=P[N(d1)]-Xe^(-rRF)(t)[N(d2)]
S=8
X=7
Rf=.03
T=.5
Sigma=.04
D1= 5.2655
D2= 5.2372
N(d1)= 1
N(d2)= 1
Intrinsic value:1
Time value: .1042
C= 1.10
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