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PLEASE SHOW WORK. No excel! Thank you Consider a stock that is currently trading at $ 5 0 and has an annualized volatility of 3
PLEASE SHOW WORK. No excel! Thank you
Consider a stock that is currently trading at $ and has an annualized volatility of The stock is not expected to pay any dividends in the next months. The annualized riskfree rate is
A Calculate the BlackScholes price of a cashornothing binary call option that matures in months. The option pays nothing if the stock price at maturity is less than $ and pays a fixed amount of $ if the stock price at maturity is higher than $
B Calculate the BlackScholes price of an assetornothing binary call option that pays nothing if the stock price at maturity months is less than $ and pays the value of the stock price at maturity or delivers the stock if the stock price at maturity is higher than $
C Use your answers from parts A and B and only your answers from parts A and B to find the BlackScholes price of a European ca option on the same underlying stock that matures in months and has a strike price of $ Please explain your answer carefully.
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