PRINCIPLES OF OPTION PRICING The following quotes were observed for options on a given stock on November 1 of a given year. These are American calls except where indicated. Use the information to answer questions through 15. Calls Puts Strike Nov Dec Jan Nov Dec Jan 105 8.40 10 11.50 5.30 1.30 2.00 110 4.40 7.10 8.30 0.90 2.50 3.80 115 1.50 3.90 5.30 2.80 4.80 4.80 The stock price was 113.25. The risk-free rates were 7 30 percent (November). 7.50 percent (December) and 7.62 percent January). The times to expiration were 0.0384 (November), 0.1342 (December), and 0.211 (anuary). Assume no dividends unless indicated 7. What is the time value of the November 110 call? a 0.00 b. 4.40 1.15 d. 3.25 e. none of the above rodo 8. What is the time value of the January 115 call? a 5.30 b. 0.00 3.50 d. 1.70 none of the above c. e. 9. What is the European lower bound of the December 105 call? 9.86 b. 0.00 8.25 d. 9.26 none of the above 0 a. 10. What is the European lower bound of the November 115 call? 1.44 b. 0.00 1.75 d. 2.06 none of the above C. e