FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 12 1 pts You are evaluating a call option on NFLX. The strike price is $118 and the expiration date is 186 days from

image text in transcribed
Question 12 1 pts You are evaluating a call option on NFLX. The strike price is $118 and the expiration date is 186 days from today. The underlying stock (NFLX) is trading at $243 today and the risk- free rate is 5%. N/d1) = 0.96 Nd2) = 0.73 What is the price of this options according to the Black- Scholes model? Please round your answer to the nearest two decimals if needed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Finance A Quantitative Introduction Volume 1

Finance A Quantitative Introduction Volume 1

Authors: Piotr Staszkiewicz, Lucia Staszkiewicz

1st Edition

0128015845, 978-0128015841

More Books

Students also viewed these Finance questions

Question

★★★★★
What are the three points of the fraud triangle? Is fraud more or less likely to occur if one of these elements is missing?

Answered: 1 week ago

Question

★★★★★
Investments in Equity Securities On March 15, 2009, Boston Company acquired 5,000 shares of Richfield Corporation common stock at $45 per share as a long-term investment. Richfield has 50,000 shares...

Answered: 1 week ago

Question

★★★★★
Suppose ???????????????????? = 2512.3, ???????????? = 273.8, ???? = 187, and there are 10 explanatory variables in the multiple regression model. (a) Construct the ANOV table. (b) Estimate ????. (c)...

Answered: 1 week ago

Question

★★★★★
Green Thumb operates a commercial plant nursery where it propagates plants for garden centers throughout the region. Green Thumb has $ 4,800,000 in as-sets. Its yearly fixed costs are $ 600,000, and...

Answered: 1 week ago

Question

★★★★★
Brief Information: Big businesses employ various techniques to lower their tax overhead and maximize profitability. Some of the most popular techniques include: Tax Havens: Establishing subsidiaries...

Answered: 1 week ago

Question

★★★★★
Diversified Semiconductors sells perishable electronic components. Some must be shipped and stored in reusable protective containers. Customers pay a deposit for each container received. The deposit...

Answered: 1 week ago

Question

★★★★★
"Saeed Al-Ghamdi" is the third employee to enter your office today, expressing his objection to the promotion of "Abdullah Ahmed" to a supervisory position, even though he only spent one year in the...

Answered: 1 week ago

Question

★★★★★
Loyalty to the organization is the paramount duty. It requires the individual to put the interests of the corporation before self-interest. Specifically, no director is permitted to gain personally,...

Answered: 1 week ago

Question

★★★★★
M&M Company manufactures a single product the claud . the following budgeted figures relate to the claud for one year period. Sales & production (units) 800 Sales $16,000 Production Costs: Variable...

Answered: 1 week ago

Question

★★★★★
You delegated the development of dessert recipe cards to Bobby. Bobby has completed the dessert cards ready for the deadline of March 10 th . Bobby has met with you to go through the dessert....

Answered: 1 week ago

Question

★★★★★
Question 19 (3 points) Listen Thames Inc.'s most recent dividend was $2.5 per share (Do = $2.5). The dividend is expected to grow at a rate of 4% per year. The risk-free rate is 3% and the return on...

Answered: 1 week ago

Question

★★★★★
Why should a firm want to create an ethical culture? Why is everyone not on board about corporate social responsibility?

Answered: 1 week ago

Question

★★★★★
Now that she is employed, what course would you follow to address her on-the-job behavior?

Answered: 1 week ago

Question

★★★★★
It may be that Mr. Garbo viewed the hiring of Amber as strictly a business decision that would ensure receiving continued business from Ambers father. What might be some negative results of this...

Answered: 1 week ago

Previous Question Next Question